On January 1, 2022, the Hermann Company general ledger shows Equipment $36,000 and Accumulated Depreciation $13,600. The
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On January 1, 2022, the Hermann Company general ledger shows Equipment $36,000 and Accumulated Depreciation $13,600. The depreciation resulted from using the straight-line method with a useful life of 10 years and a salvage value of $2,000. On this date, the company concludes that the equipment has a remaining useful life of only 2 years with the same salvage value. Compute the revised annual depreciation.
Salvage ValueSalvage value is the estimated book value of an asset after depreciation is complete, based on what a company expects to receive in exchange for the asset at the end of its useful life. As such, an asset’s estimated salvage value is an important...
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Financial Accounting Tools for Business Decision Making
ISBN: 978-1119493631
9th edition
Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso
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