Business, 19.05.2020 17:05 devie8297

Babcock Company purchased a piece of machinery for $34,500 on January 1, 2019, and has been depreciating the machine using the sum-of-the-years'-digits method based on a five-year estimated useful life and no salvage value. On January 1, 2021, Babcock decided to switch to the straight-line method of depreciation. The salvage value is still zero and the estimated useful life is changed to a total of six years from the date of purchase. Ignore income taxes.

Required:

1. Prepare the appropriate journal entry, if any, to record the accounting change under GAAP.
2. Prepare the journal entry to record depreciation for 2021.

Answers: 2

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Babcock Company purchased a piece of machinery for $34,500 on January 1, 2019, and has been deprecia...

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