Recording Depreciation with a Change in Depreciation Method Pier Exports purchases equipment on January...
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Accounting
Recording Depreciation with a Change in Depreciation Method
Pier Exports purchases equipment on January 1 at a cost of $187,500. The company estimates that there will be no salvage value and that the equipment will have a useful life of 10 years. The company elects to use the double-declining-balance method for the first three years, after which the company will change to the straight-line method of depreciation for the equipment.
Required a. Compute annual depreciation expense for Year 1 through Year 3. b. Prepare the depreciation entry for the end of Year 4. Note: Round your final answers to the nearest whole number.
a.
| Year | Annual depreciation expense |
|---|---|
| Year 1 | Answer |
| Year 2 | Answer |
| Year 3 | Answer |
b.
| Date | Account Name | Dr. | Cr. |
|---|---|---|---|
| Dec. 31, Year 4 | Answer | ||
| Answer | |||
| To record depreciation. |
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