Question -
Terry Wade, the new controller of Hellickson Company, has reviewed the expected useful lives and salvage values of selected depreciable asses at the beginning of 2017. His findings are as follows.
|
Type of Asset
|
Date Acquired
|
Cost
|
Accumulated Depreciation 1/1/17
|
Useful life in Years
|
Salvage Value
|
|
Old
|
Proposed
|
Old
|
Proposed
|
|
Building
|
1/1/11
|
$810,000
|
$115,950
|
40
|
50
|
$37,000
|
$73,650
|
|
Warehouse
|
1/1/12
|
116,000
|
22,360
|
25
|
20
|
4,200
|
27,640
|
All assets are depreciated by the straight-line method. Hellickson Company uses a calendar year in preparing annual financial statements. After discussion, management has agreed to accept Terry's proposed changes.
Compute the revised annual depreciation on each asset in 2017.