Annual depreciation = (74400-4960)/8 = $8680
Net book value at the end of 2020 = $74400 -8680*5 = $31000
Depreciation for 2021 = (31000-5580)/5 = $5084
Date | Accounts | Debit | Credit |
1 | No entry | ||
No entry | |||
2021 | Depreciatio expense | $5084 | |
Accumulated depreciation - Machine | $5084 |
Machinery purchased for $74,400 by Splish Co. in 2016 was originally estimated to have a life...
Machinery purchased for $69,000 by Vaughn Co. in 2016 was originally estimated to have a life of 8 years with a salvage value of $4,600 at the end of that time. Depreciation has been entered for 5 years on this basis. In 2021, it is determined that the total estimated life should be 10 years with a salvage value of $5,175 at the end of that time. Assume straight-line depreciation. Prepare the entry to correct the prior years' depreciation, if...
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