Jerry Grant, the new controller of Blackburn Company, has reviewed the expected useful lives and salvage values of selected depreciable assets at the beginning of 2011. His findings are as follows.
|
|
|
Accumulated |
Useful Life |
|
| Type |
Date |
|
Depreciation |
in Years
|
Salvage Value
|
|
of Asset
|
Acquired
|
Cost
|
1/1/11
|
Old
|
Proposed
|
Old
|
Proposed
|
| Building |
1/1/05 |
$819,000 |
$117,465 |
40 |
50 |
$35,900 |
$55,967 |
| Warehouse |
1/1/06 |
101,260 |
19,372 |
25 |
20 |
4,400 |
11,908
|
All assets are depreciated by the straight-line method. Blackburn Company uses a calendar year in preparing annual financial statements. After discussion, management has agreed to accept Jerry's proposed changes. Compute the revised annual depreciation on each asset in 2011. Building Warehouse Prepare the entry to record depreciation on the building in 2011 Dec.31