Pinewood Corporation purchased a piece of equipment for S70,000. It estimated an 8-year life and a $2,000 salvage value. At the end of year four (before the depreciation adjustment), it estifiated the new total life to be 10 years and the new salvage value to be $6,000. Compute the revised depreciation.

Pinewood Corporation purchased a piece of equipment for S70,000. It estimated an 8-year life and a $2,000 salvage value. At the end of year four (before the depreciation adjustment), it estifiated the new total life to be 10 years and the new salvage value to be $6,000. Compute the revised depreciation.

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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Question

1. calculation of depreciation expense. 2. net book value 3. calculation for revised depreciation for remaining years. 4. journal entry for remaining years

DO IT! 9-2b
Calculate revised depreciation.
(LO 2)
Pinewood Corporation purchased a piece of equipment for
S70,000. It estimated an 8-year life and a $2,000 salvage value.
At the end of year four (before the depreciation adjustment), it
estimated the new total life to be 10 years and the new salvage
value to be $6,000. Compute the revised depreciation.

Definition Definition Method of recording financial transactions in the book of original entry by debiting and crediting the accounts affected by a transaction using the golden rules of accrual accounting.

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