a. Using the original values, how much annual depreciation expense did Carla Vista recognize for the Building in 2020? $ b. Assume that management has agreed to accept Victor's proposed useful life change for the Building, but decides to retain the original salvage value estimate. How much annual depreciation expense will Carla Vista recognize for the Building in 2021? $ c. Using the original values, how much annual depreciation expense did Carla Vista recognize for the Machinery in 2020? $ d. Assume that management has agreed to accept Victor's proposed useful life change for the Machinery, but decides to retain the original salvage value estimate. How much annual depreciation expense will Carla Vista recognize for the Machinery in 2021? $

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Victor Mineli, the new controller of Carla Vista Co., has reviewed the expected useful lives and salvage values of selected depreciable
asset categories at the beginning of 2021. Here are his findings:
Category
of Asset
Date
Historical
Accum.
Useful Life (Years)
Original Proposed Original Proposed
Salvage Value
Acquired
Cost
Deprec.
$829,000 $369,000
Building
1/1/2003
43
$50,000 $40,000
Machinery 1/1/2011
245,000
92,000
25
20
15,000
9,000
All assets were placed into service on their acquisition dates and are depreciated by the straight-line method. Carla Vista Co. uses a
calendar year in preparing annual financial statements. Note that "Proposed" useful life is a revised estimate of total life, not
remaining life. Enter all answers in whole dollar amounts without a $. If rounding is necessary, round to the nearest whole dollar (e.g.,
XXX).
a. Using the original values, how much annual depreciation expense did Carla Vista recognize for the Building in 2020? $
b. Assume that management has agreed to accept Victor's proposed useful life change for the Building, but decides to retain the
original salvage value estimate. How much annual depreciation expense will Carla Vista recognize for the Building in 2021? $
c. Using the original values, how much annual depreciation expense did Carla Vista recognize for the Machinery in 2020? $
d. Assume that management has agreed to accept Victor's proposed useful life change for the Machinery, but decides to retain the
original salvage value estimate. How much annual depreciation expense will Carla Vista recognize for the Machinery in 2021? $
Transcribed Image Text:Victor Mineli, the new controller of Carla Vista Co., has reviewed the expected useful lives and salvage values of selected depreciable asset categories at the beginning of 2021. Here are his findings: Category of Asset Date Historical Accum. Useful Life (Years) Original Proposed Original Proposed Salvage Value Acquired Cost Deprec. $829,000 $369,000 Building 1/1/2003 43 $50,000 $40,000 Machinery 1/1/2011 245,000 92,000 25 20 15,000 9,000 All assets were placed into service on their acquisition dates and are depreciated by the straight-line method. Carla Vista Co. uses a calendar year in preparing annual financial statements. Note that "Proposed" useful life is a revised estimate of total life, not remaining life. Enter all answers in whole dollar amounts without a $. If rounding is necessary, round to the nearest whole dollar (e.g., XXX). a. Using the original values, how much annual depreciation expense did Carla Vista recognize for the Building in 2020? $ b. Assume that management has agreed to accept Victor's proposed useful life change for the Building, but decides to retain the original salvage value estimate. How much annual depreciation expense will Carla Vista recognize for the Building in 2021? $ c. Using the original values, how much annual depreciation expense did Carla Vista recognize for the Machinery in 2020? $ d. Assume that management has agreed to accept Victor's proposed useful life change for the Machinery, but decides to retain the original salvage value estimate. How much annual depreciation expense will Carla Vista recognize for the Machinery in 2021? $
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