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Arrow Equipment Manufacturers, Inc. (AEM) reported the net book value of a plant asset at $2,616,000 on January 1 of the current year. There is a $525,000 expected residual value, and the estimated useful life is 25 years. On January 1 of the current year, following 5 full years of depreciation, the company determined that the asset will be useful for only another 5 years and reduced the expected residual value to $110,000. The change in estimate is needed to reflect extended usage and running the factory above normal capacity to meet increased demand. AEM uses the straight-line method of depreciation. The company is subject to a 40% tax rate. Read the requirements. Requirement a. Determine the original cost of AEM's plant asset. The original cost of AEM's plant asset is $ - Requirements a. Determine the original cost of AEM's plant asset. b. Compute the annual depreciation expense for the first 5 years of the asset's life. c. Prepare the journal entry to record the change in estimate. d. Prepare the footnote disclosure for the accounting change