McKain, Inc., closes its books on October 31 and prepares depreciation adjustments annually. On July 27, 2019, McKain sold some equipment with an original cost of $36,250 for $18,500. The equipment was purchased on November 4, 2014, 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.