During 2016 Ryel Company s controller asked you to

prepare correcting #2520

During 2016, Ryel Company’s controller asked you to prepare correcting journal entries for the
following three situations:1. Machine A was purchased for $ 50,000 on January 1, 2011.
Straight- line depreciation has been recorded for 5 years, and the Accumulated Depreciation
account has a balance of $ 25,000. The estimated residual value remains at $ 5,000, but the
service life is now estimated to be 1 year longer than estimated originally.2. Machine B was
purchased for $ 40,000 on January 1, 2014. It had an estimated residual value of $ 5,000 and
an estimated service life of 10 years. It has been depreciated under the double- declining-
balance method for 2 years. Now, at the beginning of the third year, Ryel has decided to change
to the straight- line method.3. Machine C was purchased for $ 20,000 on January 1, 2015.
Double- declining- balance depreciation has been recorded for 1 year. The estimated residual
value of the machine is $ 2,000 and the estimated service life is 5 years. The computation of the
depreciation erroneously included the estimated residual value.Required:Prepare any
necessary correcting journal entries for each situation. Also prepare the journal entry necessary
for each situation to record depreciation expense for 2016.View Solution:
During 2016 Ryel Company s controller asked you to prepare correcting

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