Budget

Hardware Consultants purchased a building for

$522,000

and depreciated it on a straight-line basis over a

30-year

period. The estimated residual value is

$102,000.

After using the building for 15 years,

Budget

realized that wear and tear on the building would wear it out before

30

years and that the estimated residual value should be

$88,000.

Starting with the 16th year,

Budget

began depreciating the building over a revised total life of

25

years using the new residual value. Journalize depreciation expense on the building for years 15 and 16. (Record debits first, then credits. Select the explanation on the last line of the journal entry table.)

Begin by journalizing the depreciation on the building for year 15.