Question

Equipment was acquired on January 1, 2019 at a cost of $197,000. The equipment was originally estimated to have a salvage value of $12,000 and an estimated life of 10 years. Depreciation has been recorded through December 31, 2021 using the straight-line method. On January 1, 2022, the estimated salvage value was revised to $43,000 and the useful life was revised to a total of 8 years.

Prepare the journal entry to record depreciation expense for 2022. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)

Depreciation expense for 2022

$enter the Depreciation expense for 2017 in dollars

Adjusting journal entry at 12/31/22:

Answer 1

Straight line depreciation

= ( cost – Residual value ) / useful life of the asset

= ( 197000 - 12000 ) / 10

= $ 18500 per year

Depreciation provided for 3 years ( upto 2021 ) = 3 * 18500

= $ 55500

Book Value of asset in year - 2022

= 197000 - 55500

= $ 141500

New useful life of asset = 8 years

Remaining useful life = 8 - 3

= 5 years

Depreciation for the year 2022

= ( book value of asset – revised Residual value ) / remaining useful life

= ( 141500 - 43000 ) / 5

= $ 19700 per year

journal Entry at 12/31/22

Date	Accounts Name	Debit	Credit
12/31/2022	Depreciation	19700
	Accumulated depreciation		19700

only Above entry is required , Change in useful life , salvage Value requires prospective Treatment