Reference no: EM133207269

1. Eagle  had been depreciating  equipment over a  10-year useful life on a  straight-line basis. The equipment,  which cost  $24,000 and has an estimated  residual value  of $6,000 was  purchased on January  1, 2016.  On the basis of experience since  acquisition, management  decided  in 2020 to depreciate  it over a  total of 14 years, instead of 10 years,  with no change in the estimated residual value. No depreciation entry  has been recorded  for  2020.

2. In the past,  Eagle  recognized  bad debt expense equal  to 2% of sales. After careful review, it has been decided that  2.5% is more appropriate for 2020. Eagle would have reported  $19,800 of bad debt expense under the old rate of 2%  for  2020. No entry has yet been made in 2020 for  bad debt expense.

3. Eagle company purchased  another  company early in 2016 and  recorded goodwill of  $300,000. Eagle had  amortized  $20,000 of goodwill per year from  2016 to  2020. The tax treatment for goodwill was  properly  applied. (Hint: under  IFRS, goodwill is not amortised) 

Required: Prepare the  journal entry(ies)  that Eagle  needs to make to correct or adjust the accounts,  assuming  that the accounts for 2020  have not yet been closed.  Ignore income tax.