Kathleen Cole Inc acquired the following assets in January of 2005 Equipment, estimated service life, 5 years salvage value , $15,000 $525,000 Building, estimated service life, 30 years no salvage value $693,000 The equipment has been depreciated using the sum of the years digits method for the fir...

a Depreciation to date on equipment Sumoftheyearsdigits depreciation 2005 51 ...

Kathleen Cole Inc. acquired the following assets in January of 2005. Equipment, estimated service life, 5 years;

Question:

Kathleen Cole Inc. acquired the following assets in January of 2005.
Equipment, estimated service life, 5 years; , $15,000 ........$525,000
Building, estimated service life, 30 years; no ...........$693,000
The equipment has been depreciated using the sum-of-the-years’-digits method for the first 3 years for financial reporting purposes. In 2008, the company decided to change the method of computing depreciation to the straightline method for the equipment, but no change was made in the estimated service life or . It was also decided to change the total estimated service life of the building from 30 years to 40 years, with no change in the estimated . The building is depreciated on the straight-line method.
Instructions
(a) Prepare the general journal entry to record depreciation expense for the equipment in 2008.
(b) Prepare the journal entry to record depreciation expense for the building in 2008. (Round all computations to two decimal places.)

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...