During 2014 and 2015, Faulkner Manufacturing used the sum of the years digits (SYD) method of depreciation for its depreciable assets, for both financial reporting and tax purposes At the beginning of 2016, Faulkner decided to change to the straight line method for both financial reporting and tax purposes A tax rate of 40 is in effect for all years For an asset that cost $15,100 with an estimated residual value of $1,100 and an estimated useful life of 10 years, the depreciation under different methods is as follows Year Straight Line SYD Difference 2014 $1,400 $2,545 $1,145 2015 1,400 2,291 891 $2,800 $4,836 $2,036 Required 1 Prepare the journal entry that Faulkner will record in 2016 related to the change (If no entry is required for a transaction event, select No journal entry required in the first account field ) 2 Suppose instead that Faulkner previously used straight line depreciation and changed to sum of the years digits in 2016 Prepare the journal entry that Faulkner will record in 2016 related to the change (If no entry is required for a transaction event, select No journal entry required in the first account field )

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During 2014 and 2015, Faulkner Manufacturing used the sum-of-the-years-digits (SYD) method of depreciation for its depreciable assets, for both financial reporting and tax purposes. At

During 2014 and 2015, Faulkner Manufacturing used the sum-of-the-years-digits (SYD) method of depreciation for its depreciable assets, for both financial reporting and tax purposes. At the beginning of 2016, Faulkner decided to change to the straight-line method for both financial reporting and tax purposes. A tax rate of 40% is in effect for all years.

For an asset that cost $15,100 with an estimated residual value of $1,100 and an estimated useful life of 10 years, the depreciation under different methods is as follows:

Year	Straight Line	SYD	Difference
2014	$1,400	$2,545	$1,145
2015	1,400	2,291	891

	$2,800	$4,836	$2,036

Required:

Prepare the journal entry that Faulkner will record in 2016 related to the change. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

2.	Suppose instead that Faulkner previously used straight-line depreciation and changed to sum-of-the-years- digits in 2016. Prepare the journal entry that Faulkner will record in 2016 related to the change.(If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)