Assume that Smith's Auto Sales paid $45,000 for equipment with a 15-year life and zero expected residual value. After using the equipment for six years, the company determines that the asset will remain useful for only five more years. Read the requirements Requirement 1. Record depreciation expense on the equipment for Year 7 by the straight-line method First, select the formula to calculate the company's revised depreciation expense on the equipment for Year 7. Then enter the amounts and calculate the depreciation for Year 7. (Enter "O" for items with a zero value.) Book value 27,000 Residual value Revised Revised useful life remaining depreciation 5,400 Record the depreciation on the equipment for Year 7. (Record debits first, then credits. Select the explanation on the last line of the journal entry table) Date Accounts and Explanation Accumulated Depreciation-Building Requirement 2. What is accumulated depreciation at the end of Year 77 The accumulated depreciation at the end of Year 7 2,7000 Debit Credit