Sesame Company purchased a computer system for $74,000 on January 1, 2019. It was depreciated based on

Question:

Sesame Company purchased a computer system for $74,000 on January 1, 2019. It was depreciated based on a 7-year life and an $18,000 salvage value. On January 1, 2021, Sesame revised these estimates to a total useful life of 4 years and a salvage value of $10,000. Prepare Sesame’s entry to record 2021 depreciation expense. Sesame uses straight-line depreciation.

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...

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