General Electric Data for the year ended December 31, 2023:

• Property, plant, and equipment (PPE) cost: $10,000,000
• Accumulated depreciation: $4,000,000
• Estimated salvage value: $1,000,000
• Remaining useful life: 5 years
• Annual depreciation expense: $900,000
• Calculate the book value of PPE.
• Determine the new depreciation expense if the estimated useful life is reduced to 4 years.
• Discuss the financial statement impact of this change in estimate.
• Explain the significance of the Conservatism Principle in depreciation.
• How should the company record the change in depreciation expense?