How much the donut stop should record each year

Reference no: EM131521369

Question: The Donut Stop acquired equipment for $25,000. The company uses straightline depreciation and estimates a residual value of $5,000 and a four-year service life. At the end of the second year, the company estimates that the equipment will be useful for four additional years, for a total service life of six years rather than the original four. At the same time, the company also changed the estimated residual value to $3,000 from the original estimate of $5,000.

Required: Calculate how much The Donut Stop should record each year for depreciation in years 3 to 6.

Reference no: EM131521369

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