Holt Developments Ltd. put an asset in service on January 1, 2018. Its cost was $396,000,...
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Holt Developments Ltd. put an asset in service on January 1, 2018. Its cost was $396,000, its predicted service life was six years, and its expected residual value was $39,600. The company decided to use double-declining-balance depreciation. After consulting with the company's auditors, management decided to change to straight-line depreciation in 2020, without changing either the original service life or residual value. Required: a. What is depreciation expense for 2020? Depreciation expense b. Calculate the effect of this change on retained earnings. Retained earnings will by Holt Developments Ltd. put an asset in service on January 1, 2018. Its cost was $396,000, its predicted service life was six years, and its expected residual value was $39,600. The company decided to use double-declining-balance depreciation. After consulting with the company's auditors, management decided to change to straight-line depreciation in 2020, without changing either the original service life or residual value. Required: a. What is depreciation expense for 2020? Depreciation expense b. Calculate the effect of this change on retained earnings. Retained earnings will by
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Original cost of the Asset is396000 Useful life6 yrs Depr... View the full answer
Related Book For
Fundamental Accounting Principles Volume II
ISBN: 978-1259066511
14th Canadian Edition
Authors: Larson Kermit, Jensen Tilly
Posted Date:
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