Pharoah Inc. acquired the following assets in January 2023. Equipment, estimated service life, 5 years; no salvage value Building, estimated service life, 40 years; salvage value, $567,000 The equipment has been depreciated using the double-declining balance method for the first 2 years for financial reporting purposes. In 2025, the company decided to change the method of computing depreciation to the straight-line method for the equipment, but no change was made in the estimated service life or salvage value. It was also decided to change the total estimated service life of the building from 40 years to 35 years, with no change in the estimated salvage value. The building is depreciated on the straight-line method. (a) (b) No. Account Titles and Explanation (a) (b) Prepare the general journal entry to record depreciation expense for the equipment in 2025. Prepare the journal entry to record depreciation expense for the building in 2025. Depreciation Expense Accumulated Depreciation-Equipment $621,000 $5,007,000 Depreciation Expense Accumulated Depreciation-Buildings Debit Credit 0000

Pharoah Inc. acquired the following assets in January 2023. Equipment, estimated service life, 5 years; no salvage value Building, estimated service life, 40 years; salvage value, $567,000 The equipment has been depreciated using the double-declining balance method for the first 2 years for financial reporting purposes. In 2025, the company decided to change the method of computing depreciation to the straight-line method for the equipment, but no change was made in the estimated service life or salvage value. It was also decided to change the total estimated service life of the building from 40 years to 35 years, with no change in the estimated salvage value. The building is depreciated on the straight-line method. (a) (b) No. Account Titles and Explanation (a) (b) Prepare the general journal entry to record depreciation expense for the equipment in 2025. Prepare the journal entry to record depreciation expense for the building in 2025. Depreciation Expense Accumulated Depreciation-Equipment $621,000 $5,007,000 Depreciation Expense Accumulated Depreciation-Buildings Debit Credit 0000

Name: Vinubhai Pharoah Inc. acquired the following assets in January 2023.Eq
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Description: Vinubhai Pharoah Inc. acquired the following assets in January 2023.Equipment, estimated service life, 5 years; no salvage valueBuilding, estimated service life, 40 years; salvage value, $567,000The equipment has been depreciated using the double-dec

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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