McKain, Inc., closes its books on October 31 and prepares depreciation adjustments annually. On July 27, 2010, McKain sold some equipment with an original cost of $ 36,250 for $ 18,500. The equipment was purchased on November 4, 2005, and was depreciated using the straight-line method and had an estimated useful life of eight years and a salvage value of $ 1,650. Prepare the entries to update the depreciation and record the sale of the equipment.
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