Question - Change in Estimate
Assume that Bloomer Company purchased a new machine on January 1, 2014, for $98,000. The machine has an estimated useful life of nine years and a residual value of $9,800. Bloomer has chosen to use the straight-line method of depreciation. On January 1, 2016, Bloomer discovered that the machine would not be useful beyond December 31, 2019, and estimated its value at that time to be $2,400.
Required:
1. Calculate the depreciation expense, accumulated depreciation, and book value of the asset for each year 2014 to 2019. If necessary, round any depreciation calculations to the nearest dollar.
2. Bloomer Company made a - Select your answer -correction of an error change in estimate Item 19 based on - Select your answer -new information historical information Item 20. This requires - Select your answer -restating financial statements correcting the error revising depreciation for future recording Item 21 and the past estimates are considered - Select your answer -wrong correct for the past time periods Item 22 since the company used the best information available at that time.