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Total company purchased an equipment for 1,200,000 that had an estimated residual value of 100,000 and an estimated service life of 10 years. The asset is being depreciated using the Straight-line method.
REQUIRED:
Problem a: What is the amount of depreciation expense for the fifth year under each of the following independent accounting changes?
1. The company changes to the sum-of-the-years' digits method but there is no change in the expected residual value.
2. The asset's remaining useful life is revised to 5 years, and residual value is reduced to 60,000.
3. It was estimated that the asset should be useful for a total of 8 years from the date of acquisition, without residual value.
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