Lugar Company purchased a piece of machinery for $33,000 onJanuary 1, 2014, and has been depreciating the machine using thesum-of-the-years'-digits method based on a five-year estimateduseful life and no salvage value. On January 1, 2016, Lugar decidedto switch to the straight-line method of depreciation. The salvagevalue is still zero and the estimated useful life is changed to atotal of six years from the date of purchase. Ignore incometaxes.
Required:
1. Prepare the appropriate journal entry, if any, to record theaccounting change. (If no entry is required for atransaction/event, select "No journal entry required" in the firstaccount field.)
Lugar Company purchased a piece of machinery for $33,000 onJanuary 1, 2014, and has been depreciating the machine using thesum-of-the-years'-digits method based on a five-year estimateduseful life and no salvage value. On January 1, 2016, Lugar decidedto switch to the straight-line method of depreciation. The salvagevalue is still zero and the estimated useful life is changed to atotal of six years from the date of purchase. Ignore incometaxes. |
| Required: |
| 1. | Prepare the appropriate journal entry, if any, to record theaccounting change. (If no entry is required for atransaction/event, select "No journal entry required" in the firstaccount field.) |
Related questions
Lugar Company purchased a piece of machinery for $19,500 onJanuary 1, 2014, and has been depreciating the machine using thesum-of-the-years'-digits method based on a five-year estimateduseful life and no salvage value. On January 1, 2016, Lugar decidedto switch to the straight-line method of depreciation. The salvagevalue is still zero and the estimated useful life is changed to atotal of six years from the date of purchase. Ignore incometaxes.
| Prepare the appropriate journal entry, if any, to record theaccounting change Prepare the journal entry to record depreciation for 2016 |
Irwin, Inc., constructed a machine at a total cost of $35million. Construction was completed at the end of 2012 and themachine was placed in service at the beginning of 2013. The machinewas being depreciated over a 10-year life using thesum-of-the-yearsâ-digits method. The residual value is expected tobe $2 million. At the beginning of 2016, Irwin decided to change tothe straight-line method. |
Ignoring income taxes, prepare the journal entry relating to themachine for 2016. (If no entry is required for atransaction/event, select "No journal entry required" in the firstaccount field. Enter your answers in millions rounded to 1 decimalplace (i.e., 5,500,000 should be entered as 5.5).) |
