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Question - On 30 June 2023, the end of the current reporting period, Kirk Ltd made a decision, using the information obtained over the past few years, to revise the useful life of its building acquired five years earlier on 1 July 2019 for $1 000 000. The useful life was revised from ten years to 15 years. The building was originally depreciated on the straight-line basis over its useful life and it was expected that the building would have no residual value. No depreciation has been provided in the current period.
Required - Prepare the journal entry to account for the change in accounting estimate. Assuming that the change in accounting estimate had a material effect on financial performance for the period, prepare an appropriate supporting note.
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