Cosenza Ltd acquired a truck with a cost of $250 000, an estimated useful life of 6 years and a residual value of $30 000. Sum-of-years-digits depreciation was used. Ignore GST.

Required

Prepare the journal entries for each of the following events:

1.    Sell the tractor for cash of $120000 after 2 years of use.

2.    Trade in the tractor for a $40000 allowance after 4 years on another tractor with a cash price of $275000.

3.    Scrap the tractor after 5 years of use. The tractor was given to a scrap dealer who pays $2000 to remove it.