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  3. on january 1, 2015, lane company made a $12,000 ex

On January 1, 2015, Lane Company made a $12,000 expenditure on a fully depreciated machine....

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Accounting

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On January 1, 2015, Lane Company made a $12,000 expenditure on a fully depreciated machine. The expenditure increased the expected life of the new machine for two years until December 31, 2016. Lane uses straight-line depreciation with no salvage value. However, Lane erroneously expensed this capital expenditure. As a result of this error, a. 2015 income is overstated by $3,000 and 2016 income is understated by $3,000. b. 2015 income is understated by $6,000 and 2016 income is overstated by $6,000. c. 2015 income is understated by $6,000 and 2016 income is overstated by $3,000. d. 2015 income is understated by $6,000 and 2015 income is correctly stated

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