For financial reporting, Clinton Poultry Farms has used the declining-balance method of depreciation for conveyor equipment acquireat the beginning of 2015 for $2,736,000. Its useful life was estimated to be six years with a $204,000 residual value. At the beginningof 2018, Clinton decides to change to the straight-line method. The effect of this change on depreciation for each year is as follows (SIn 000s):Year Straight-Line Declining Balance2015$ 42220164222017422$1,266No1$912608405$1,925Required:2. Prepare any 2018 Journal entry related to the change. (Enter your answers in dollars rounded to the nearest thousand. If no entryIs required for a transaction/event, select "No Journal entry required" In the first account field.)Event1Difference$490186(17)Depreciation expense$659Answer is complete but not entirely correct.General JournalAccumulated depreciationDebit211,333 XCredit211,333

Depreciation expense is recorded on the tangible asset with definite life. It is an expense and…

For financial reporting, Clinton Poultry Farms has used the declining-balance method of depreciation for conveyor equipment acquir at the beginning of 2015 for $2,736,000. Its useful life was estimated to be six years with a $204,000 residual value. At the beginnim of 2018, Clinton decides to change to the straight-line method. The effect of this change on depreciation for each year is as follows ( In 000s): Year Straight-Line Declining Balance 2015 $ 422 2016 422 2017 422 $1,266 $912 608 405 $1,925 Difference $490 186 (17) $659 Required: 2. Prepare any 2018 Journal entry related to the change. (Enter your answers in dollars rounded to the nearest thousand. If no entry Is required for a transaction/event, select "No Journal entry required" In the first account fleld.)

For financial reporting, Clinton Poultry Farms has used the declining-balance method of depreciation for conveyor equipment acquir at the beginning of 2015 for $2,736,000. Its useful life was estimated to be six years with a $204,000 residual value. At the beginnim of 2018, Clinton decides to change to the straight-line method. The effect of this change on depreciation for each year is as follows ( In 000s): Year Straight-Line Declining Balance 2015 $ 422 2016 422 2017 422 $1,266 $912 608 405 $1,925 Difference $490 186 (17) $659 Required: 2. Prepare any 2018 Journal entry related to the change. (Enter your answers in dollars rounded to the nearest thousand. If no entry Is required for a transaction/event, select "No Journal entry required" In the first account fleld.)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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