Question

Salem Hardware Consultants purchased a building for $560,000 and depreciated it on a straight-line basis over a 40-year period. The estimated residual value is $120,000. After using the building for 15 years, Salem realized that wear and tear on the building would wear it out before 40 years and that the estimated residual value should be $110,000. Starting with the 16th year, Salem began depreciating the building over a revised total life of 35 years using the new residual value. Journalize depreciation expense on the building for years 15 and 16. (Record debits first, then credits. Select the explanation on the last line of the journal entry table.) Begin by journalizing the depreciation on the building for year 15. Date Accounts and Explanation Debit Credit Choose from any list or enter any number in the input fields and then click Check Answer. part I remaining acerintedovarcielo Clear All Check Answer

Answer 1

Date	account title and explanation	Debit	Credit
Dec 31, 2015	Depreciation expense	11000
	Accumulated depreciation-Building		11000
	(To record dep)

Original Depreciation = (560000-120000/40) = 11000

Date	account title and explanation	Debit	Credit
Dec 31,2016	Depreciation expense	14250
	Accumulated depreciation-Building		14250
	(To record dep)

Revised Depreciation = (560000-165000-110000/20) = 14250