On January 1, Year 1, Poultry Processing Company purchased a freezer and related installation equipment for $42,000.
Question:
On January 1, Year 1, Poultry Processing Company purchased a freezer and related installation equipment for $42,000. The equipment had a three-year estimated life with a $3,000 salvage value. Straightline depreciation was used. At the beginning of Year 3, Poultry Processing revised the expected life of the asset to four years rather than three years. The salvage value was revised to $2,000.
Required
Compute the depreciation expense for each of the four years, Year 1 through Year 4.
Salvage 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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Depreciation Expense Year 1 42000 3000 39000 39000 3 13000 Year 2 Same as Year 1 13000 Year 3 Cost ...View the full answer
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Related Book For 
Introductory Financial Accounting for Business
ISBN: 978-1260299441
1st edition
Authors: Thomas Edmonds, Christopher Edmonds
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