Pooh Inc. constructed a machine at a total cost of $70 million. Construction was completed at...

 

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Pooh Inc. constructed a machine at a total cost of $70 million. Construction was completed at the end of 2010 and the machine was placed in service at the beginning of 2011. The machine was being depreciated over a 10-year life using the sum-of-the-years'-digits method. The residual value will not change from the original $4 million. At the beginning of 2014, Pooh decided to change to the straight-line method. 1. Ignoring income taxes, what journal entry(s) should Pooh record relating to the machine for 2014? 2. Suppose Pooh has been using the straight-line method and switches to the sum-of-the-years'-digits method. Ignoring income taxes, what journal entry(s) should Pooh record relating to the machine for 2014? Pooh Inc. constructed a machine at a total cost of $70 million. Construction was completed at the end of 2010 and the machine was placed in service at the beginning of 2011. The machine was being depreciated over a 10-year life using the sum-of-the-years'-digits method. The residual value will not change from the original $4 million. At the beginning of 2014, Pooh decided to change to the straight-line method. 1. Ignoring income taxes, what journal entry(s) should Pooh record relating to the machine for 2014? 2. Suppose Pooh has been using the straight-line method and switches to the sum-of-the-years'-digits method. Ignoring income taxes, what journal entry(s) should Pooh record relating to the machine for 2014?

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1 Depreciation Ac DR 6600000 million To accumulated Depreciatio... View the full answer