Brief Exercise 11-10 Change in estimate; useful life of equipment [L011-5] facli

Question

Brief Exercise 11-10 Change in estimate; useful life of equipment [L011-5] faclitytor 513 s to the budg epeciaton fer At the beginning of 2016, Robotics Inc. acquired a manufacturing facility for $13.9 million. $10.9 million of the purchase price was allocated to the building. Depreciation for 2016 and 2017 was calculated using the straight-line method, a 25-year useful life, and a $2.9 million residual value. In 2018, the estimates of useful life and residual value were changed to 20 total years and $690,000, respectively What is depreciation on the building for 2018? (Round answer to the nearest whole dollar.) Depreciation $ 549,444

Explanation / Answer

Building cost at beginning of 2016 10,900,000 Annual Depreciation for 2016 or 2017 = (10,900,000-2,900,000)/25 = 320,000 Building cost at beginning of 2018 10,260,000 (10,900,000-(320000*2)) Revised Life of Asset 20 Years Revised Salvage value        690,000 Annual Depreciation for 2018 = (10,260,000-690,000)/20 = $ 478,500

Related Questions

Navigate

• Browse (All)
• Browse B
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.