Exercise 11-16

Machinery purchased for $71,600 by Riverbed Corp. on January 1, 2015, was originally estimated to have an 8-year useful life with a residual value of $6,000. Depreciation has been entered for five years on this basis. In 2020, it is determined that the total estimated useful life (including 2020) should have been 10 years, with a residual value of $6,800 at the end of that time. Assume straight-line depreciation and that Riverbed Corp. uses IFRS for financial statement purposes.

Prepare the entry to record depreciation for 2020. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter o for the amounts.) Account Titles and Explanation Debit Credit 4760 Depreciation Expense Accumulated Depreciati C D 4760 SHOW LIST OF ACCOUNTS LINK TO TEXT Repeat part (b) assuming Riverbed Corp. uses ASPE and the machinery is originally estimated to have a physical life of 8.5 years and a salvage value of $0. In 2020, it is determined that the total estimated physical life (including 2020) should have been 11 years, with a salvage value of $100 at the end of that time. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter o for the amounts. Round answers to 0 decimal places, e.g. 5,275.) Debit Credit Account Titles and Explanation Depreciation Expense 4930 Accumulated Depreciati 4930 SHOW LIST OF ACCOUNTS LINK TO TEXT Repeat part (b) assuming Riverbed Corp. uses the double-declining-balance method of depreciation. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter o for the amounts. Round answers to o decimal places, e.g. 5,275.) Account Titles and Explanation Debit Credit Depreciation Expense Accumulated Depreciation