(Depreciation Change in Estimate) Machinery purchased for $60,000 by Tom Brady Co. In
2010 was originally estimated to have a life of 8 years with a salvage value of $4,000 at the end of that time. Depreciation has been entered for 5 years on this basis. In 2015, it is determined that the total estimated life should be 10 years with a salvage value of $4,500 at the end of that time. Assume straight-line depreciation.
Instructions
(a) Prepare the entry to correct the prior year’s depreciation, if necessary. (b) Prepare the entry to record depreciation for 2015.