On January 1, 2019, Cullumber Corporation acquired machinery at a cost of $1650000. Cullumber adopted the straight-line method of depreciation for this machine and had been recording depreciation over an estimated life of ten years, with no residual value. At the beginning of 2022, a decision was made to change to the double-declining balance method of depreciation for this machine. Assuming a 30% tax rate, the cumulative effect of this accounting change on beginning retained earnings, is $217140. $184800. $310200. $0.

FINANCIAL ACCOUNTING
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ISBN:9781259964947
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Chapter1: Financial Statements And Business Decisions
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On January 1, 2019, Cullumber Corporation acquired machinery at a cost of $1650000. Cullumber adopted the straight-line method of depreciation for this machine and had been recording depreciation over an estimated life of ten years, with no residual value. At the beginning of 2022, a decision was made to change to the double-declining balance method of depreciation for this machine.

Assuming a 30% tax rate, the cumulative effect of this accounting change on beginning retained earnings, is

$217140.
$184800.
$310200.
$0.
Expert Solution
Step 1 introduction

Depreciation is an accounting method used to allocate the cost of a tangible or physical asset over its useful life. depreciation represents how much of an asset's value has been used up. two commonly used method for depreciation are Straight-Line Depreciation and Declining Balance Depreciation.

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