Reference no: EM133080428
Question - Consider the following information for Alpha Corporation:
Alpha Corp.'s reported $150,000, $125,000, $95,0000 pretax incomes for 2020,2019 and 2018 respectively.
On March 1, 2017, Alpha bought a piece of machinery for $108,000, with a $12,000 estimated residual value and an eight-year life. At that time, the bookkeeper debited an expense account for this purchase.
2020's income was correctly determined after taking into account the following accounting changes and error corrections made during the year (the errors were made in previous years but were not discovered until 2020). The incomes for 2018 and 2019 do not take these items into account and are stated at the amounts determined at the time.
Alpha uses the straight-line depreciation method.
Required - Prepare the required journal entry/ entries Alpha Corp. would have prepared to adjust its books during 2020?