Exercise 10-8 (Part Level Submission) nt Terry Wade, the new controller of Helli

Question

Exercise 10-8 (Part Level Submission) nt Terry Wade, the new controller of Hellickson Company, has reviewed the expected useful lives and salvage values of selected depreciable assets at the beginning of 2017. His findings are as follows Accumulated Useful life Depreciation in Date Salvage Value on Type of Asset Acquired Cost Building 1/1/11 $824,000 Warehouse 1/1/12 107,000 1/1/17 old Proposed old Proposed $117,600 40 50 $40,000 $64,000 20,540 25 20 4,300 12,960 All assets are depreciated by the straight-line method. Hellickson Company uses a calendar year in preparing annual financial statements. After discussion, management has agreed to accept Terry's proposed changes ? (a) Compute the revised annual depreciation on each asset in 2017. Building Warehouse Revised annual depreciation SHOW LIST OF ACCOUNTS LINK TO TEXT

Explanation / Answer

Building Warehouse Revised annual depreciation $ 14,600 $          4,900 Workings: Building Warehouse Costs        8,24,000        1,07,000 Less:Accumulated depreciation        1,17,600            20,540 Book Value a        7,06,400            86,460 Revised salvage value b            64,000            12,960 Revised balance life c 44 15 (50-6) (20-5) Revised Annual depreciation (a-b)/c $        14,600 $          4,900

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