Barker Corp., which has a calendar fiscal year, purchased its only depreciable capital asset on 1 January 20X3.

Information related to the depreciable asset:

original cost = $560,000

estimated residual value = $48,000

depreciation method = declining balance

depreciation rate = 20%

In 20X5, Barker decreased the estimated residual value to $16,000, and increased the depreciation rate to 30%. Both changes are the result of experience with the asset and revised expectations about the pattern of usage.

Additional information for 20X5:

revenue - $2,800,000

expenses other than

depreciation and tax - $1,680,000

gain/(loss) from discontinued

operations - before tax - $(40,000)

tax rate - 25%

Additional information for 20X4:

revenue - $2,240,000

expenses other than

depreciation and tax - $1,534,400

gain/(loss) from discontinued

operations - before tax - N/A (zero)

tax rate - 25%

Required:

1.Calculate the ending 20X5 balance of accumulated depreciation and show the 20X5 journal entry/entries for depreciation.

2.Prepare the condensed comparative statements of comprehensive income for 20X4 & 20X5, including disclosures related to the accounting change.