Compute the revised annual depreciation

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Reference no: EM13258139

Will Smith, the new controller of Fresh Prince Company, hasreviewed the expected useful lives and salvage values of selecteddepreciable assets at the beginning of 2007. Here are hisfindings:

			Accumulated	Useful Life
Type of	Date		Depreciation,	(in years)		SalvageValue
Asset	Acquired	Cost	Jan. 1,2007	Old	Proposed	Old	Proposed
Building	Jan. 1, 1999	$900,000	$172,000	40	50	$40,000	$47,600
Warehouse	Jan. 1, 2001	120,000	27,600	25	20	5,000	3,600

All assets are depreciated by the straight-line method. FreshPrince Company uses a calendar year in preparing annual financialstatements. After discussion, management has agreed to acceptWill's proposed changes. (The "Proposed" useful life is total life,not remaining life.)

Compute the revised annual depreciation on each asset in 2007.

Prepare the entry to record depreciation on the building in2007.

Reference no: EM13258139

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