A company began operations on January 1, 2019. Purchases of property, plant and equipment during 2019 was as follows:

Cost Residual Value

March 31, 2019 Equipment 1 420,000 40,000

June 30, 2019 Equipment 2 590,000 50,000

Equipment is being depreciated on a straight-line basis over an estimated useful life of 8 years.

The following transactions took place during 2020:

Purchased Equipment 3 on January 31, 2020 for $365,000. There is no residual value. For this piece of equipment, it was determined due to the nature of the equipment to depreciate straight line over 12 years.

Sold equipment 1 for $350,000 on April 1, 2020. The bookkeeper was unsure how to handle the transaction and credited the proceeds to the equipment account.

Required:

A) Calculate the accumulated depreciation balance at December 31, 2019.

B) Prepare the required journal entries at December 31, 2020 to account for the 2020 depreciation and adjusting journal entry to correct the recording of the sale of the equipment during the year