Zebra Corp changed from the straight line method to the double declining balance method in 2015 on all its equipment There was no change in the salvage value s or useful lives The equipment was purchased in 2014, and the original cost was $600,000 with no salvage value and a 6 year estimated useful...

a Depreciation Expense 200000 Accumulated Depreciation 200000 Original cost 600000 Accumulated depr ...

Zebra Corp. changed from the straight-line method to the double-declining-balance method in 2015 on all its equipment.

Question:

Zebra Corp. changed from the straight-line method to the double-declining-balance method in 2015 on all its equipment. There was no change in the s or useful lives. The equipment was purchased in 2014, and the original cost was $600,000 with no and a 6-year estimated useful life. Income before depreciation expense was $560,000 in 2014 and $760,000 in 2015. Zebra’s tax rate is 40%.

Instructions
(a) Prepare the journal entry(ies) to record the change in depreciation method in 2015.
(b) Starting with income before depreciation expense, prepare the remaining portion of the income statement for 2014 and 2015.

Salvage Value
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...