Smith's Auto Company purchased a computer for $3,300, debiting Computer Equipment. During 2016 and 2017, Smith's Auto recorded total depreciation of $2,500 on the computer. On January 1, 2018, Smith's Auto traded in the computer for a new one, paying $3,200 cash. The fair market value of the new computer is $4,700. Journalize Smith's Auto's exchange of computers. Assume the exchange had commercial substance. Let's begin by calculating the gain or loss on the exchange of computer equipment on January 1. Market value of assets received Less: Book value of asset exchanged Cash paid Gain or (Loss) Journalize Smith's Auto's exchange of computers. (Record a single compound journal entry. Record debits first, then credits. Select the explanation on the last line of the journal entry table.) Date Accounts and Explanation Debit Credit Jan. 1