Exhibit 22-2 On January 1, 2015, Nathan, Inc. purchased a machine for $56,000. Eight-year, straight-line depreciation...
Exhibit 22-2
On January 1, 2015, Nathan, Inc. purchased a machine for $56,000.
Eight-year, straight-line depreciation with no salvage value was
used through December 31, 2016. On January 1, 2017, it was
estimated that the total useful life of the machine from
acquisition date was ten years.
Refer to Exhibit 22-2. The adjusting entry that should be made on
January 1, 2017, will be in the amount of
|
$6,000 |
||
|
$3,600 |
||
|
$2,400 |
||
|
$ 0 |
Homework Answers
Depreciation for 2 years = $56,000 / 8 * 2 = $14,000
Book value of machine as on January 1, 2017 = $56,000 - 14,000 = $42,000
Revised depreciation expense = $42,000 / 8 = $5,250.
Hence adjusting entry made on January 1, 2017 will be in amount of $0.
Hence option $0 is correct.
Add Answer to:
Exhibit 22-2
On January 1, 2015, Nathan, Inc. purchased a machine for $56,000.
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December 31 and operates the machine as follows: 2015, 21,600 hrs;
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