Multiple Choice
A firm purchased an office machine for $4,600, estimated that it will use the machine for 15 years, and estimated a salvage value of $100.On December 31 of the sixth year, before closing the books for the year, the firm analyzed its estimates of useful life and salvage value.In light of new information, the firm estimated that the machine will have a total useful life of only 10 years, and the salvage estimate of $100 remains reasonable. The new estimate of the remaining life is five years (the year just ended plus the next four) .The depreciation entry on December 31 of the sixth year and each year thereafter is:
A) Depreciation Expense............ 300
Accumulated Depreciation ......................300
B) Depreciation Expense...................... 600
Accumulated Depreciation ...................600
C) Accumulated Depreciation .................300
Depreciation Expense........................... 300
D) Accumulated Depreciation ...................600
Depreciation Expense......................... 600
E) none of the above
Correct Answer:
Verified
Correct Answer:
Verified
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