ACCT $51$B

Chapter $21$ Exercise

You must submit your solution as ONE PDF file. Google Docs$/$Sheets allows you to download your work into a PDF file by going to the "File" menu item and selecting "Download" and $"$PDF$".$ You must format your work correctly$/$professionally ensuring that your submission doesn't have your work being split and cut off onto multiple pages. Simply submit ONE PDF file that you could print and turn in if this were an in$-$person course.

Case Instructions

On January $1,2019,$ Calvin Company purchased a building and machinery that have the following useful lives, salvage value, and costs.

Building, $30-$year estimated useful life, $$65,000,000$ cost$,$ $$5,000,000$ salvage value Machinery, $15-$year estimated useful life, $$6,000,000$ cost$,$ no salvage value

The building has been depreciated under the straight$-$line method through $2023.$ In $2024,$ the company decided to switch to the double$-$declining balance method of depreciation for the building. Calvin also decided to change the total useful life of the machinery to $10$ years $($measured from the original acquisition date$),$ with a salvage value of $$500,000$ at the end of that time. The machinery is depreciated using the straight$-$line method.

Instructions

a$)$ Prepare a detailed calculation of $2024$ depreciation expense on the building.

b$)$ Prepare the journal entry necessary to record the depreciation expense on the building in $2024.$ Journal entry description is not required.

c$)$ Prepare a detailed calculation of $2024$ depreciation expense on the machinery.