Depreciation - change in estimate
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E11-11 (Depreciation - Change in Estimate) Machinery purchased for $60,000 by Tom Brady Co. in 2003 was orginally to have a life of 8 yrs. with a salvage value of $4,000 at the end of that time. Depeciaition has been entered for f5 years on this basis. In 2008, it is determined that the total estimated life should be 10 years with a salvage value of $4,500 at the end of that time. Assume straight-line depreciation.
Prepare the entry to correct the prior years' depreciation, if necessary. Prepare the entry to record depreciation for 2008.
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Solution Summary
The solution explains how to make the entries for a change in estimate relating to depreciation
Solution Preview
The change in life and salvage value is a change in estimate and that will affect only the current and future periods. There will be no change in the past ...
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