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XYZ Co purchased a mixer on January 1, 2019, at a cost of $45,000. Straight-line depreciation for 2019 and 2020 was based on an estimated eight-year life and $3,000 estimated residual value. In 2022, the company revised its estimate and now believes the mixer will have a total service life of only six years, and that the residual value will be only $2,000. Required: (show computations) Compute depreciation for 2022 and 2023.

XYZ Co purchased a mixer on January 1, 2019, at a cost of $45,000. Straight-line depreciation for 2019 and 2020 was based on an estimated eight-year life and $3,000 estimated residual value. In 2022, the company revised its estimate and now believes the mixer will have a total service life of only six years, and that the residual value will be only $2,000. Required: (show computations) Compute depreciation for 2022 and 2023.

FINANCIAL ACCOUNTING
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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XYZ Co purchased a mixer on January 1, 2019, at a cost of $45,000. Straight-line depreciation for 2019 and 2020 was based on an estimated eight-year life and $3,000 estimated residual value. In 2022, the company revised its estimate and now believes the mixer will have a total service life of only six years, and that the residual value will be only $2,000. Required: (show computations) Compute depreciation for 2022 and 2023.
Transcribed Image Text:XYZ Co purchased a mixer on January 1, 2019, at a cost of $45,000. Straight-line depreciation for 2019 and 2020 was based on an estimated eight-year life and $3,000 estimated residual value. In 2022, the company revised its estimate and now believes the mixer will have a total service life of only six years, and that the residual value will be only $2,000. Required: (show computations) Compute depreciation for 2022 and 2023.
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