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  • Swindall Industries Uses Straight Line Depreciation On All of Its Depreciable

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    Amit Pandey
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    Swindall Industries purchased a machine for $90,000 in January 2014 that was estimated to have a useful life of 12 years and residual value of $18,000. The company recorded annual depreciation expense at year-end using straight-line depreciation. In 2018, after almost five years of use, management revised the machine's estimated useful life from 12 to 20 years based on experience, but did not change the estimated residual value.

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    Swindall Industries purchased a machine for $90,000 in January 2014 that was estimated to have a useful life of 12 years and residual value of $18,000. The company recorded annual depreciation expense at year-end using straight-line depreciation. In 2018, after almost five years of use, management revised the machine's estimated useful life from 12 to 20 years based on experience, but did not change the estimated residual value.

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    62 views1 page

    Swindall Industries Uses Straight Line Depreciation On All of Its Depreciable

    Uploaded by

    Amit Pandey
    Swindall Industries purchased a machine for $90,000 in January 2014 that was estimated to have a useful life of 12 years and residual value of $18,000. The company recorded annual depreciation expense at year-end using straight-line depreciation. In 2018, after almost five years of use, management revised the machine's estimated useful life from 12 to 20 years based on experience, but did not change the estimated residual value.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    Swindall Industries uses straight line depreciation on all of

    its depreciable

    Swindall Industries uses straight-line depreciation on all of its depreciable assets. The company
    records annual depreciation expense at the end of each calendar year. On January 11, 2014,
    the company purchased a machine costing $90,000. The machine's useful life was estimated to
    be 12 years with an estimated residual value of $18,000. Depreciation for partial years is
    recorded to the nearest full month.

    In 2018, after almost five years of experience with the machine, management decided to revise
    its estimated life from 12 years to 20 years. No change was made in the estimated residual
    value. The revised estimate of the useful life was decided prior to recording annual depreciation
    expense for the year ended December 31, 2018.

    a. Prepare journal entries in chronological order for the given events, beginning with the
    purchase of the machinery on January 11, 2014. Show separately the recording of depreciation
    expense in 2014 through 2018.

    b. What factors may have caused the company to revise its estimate of the machine's useful
    life?

    Swindall Industries uses straight line depreciation on all of its depreciable


    SOLUTION-- http://solutiondone.online/downloads/swindall-industries-uses-straight-line-
    depreciation-on-all-of-its-depreciable/

    Unlock answers here solutiondone.online


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