Holtzman Company is in the process of preparing its financial statements for 2014. Assume that no entries for depreciation have been recorded in 2014. The following information related to depreciation of fixed assets is provided to you.

1.	Holtzman purchased equipment on January 2, 2011, for $84,200. At that time, the equipment had an estimated useful life of 10 years with a $4,200 salvage value. The equipment is depreciated on a straight-line basis. On January 2, 2014, as a result of additional information, the company determined that the equipment has a remaining useful life of 4 years with a $2,800 salvage value.
2.	During 2014, Holtzman changed from the double-declining-balance method for its building to the straight-line method. The building originally cost $500,000. It had a useful life of 10 years and a salvage value of $25,000. The following computations present depreciation on both bases for 2012 and 2013.

2013	2012
Straight-line	$47,500	$47,500
Declining-balance	80,000	100,000

3.	Holtzman purchased a machine on July 1, 2012, at a cost of $120,000. The machine has a salvage value of $10,000 and a useful life of 8 years. Holtzmans bookkeeper recorded straight-line depreciation in 2012 and 2013 but failed to consider the salvage value.

Prepare the journal entries to record depreciation expense for 2014 and correct any errors made to date related to the information provided. (Ignore taxes.)(Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

No.	Account Titles and Explanation	Debit	Credit
1.
2.
3.
(To record current year depreciation.)
(To correct prior year depreciation.)

Show comparative net income for 2013 and 2014. Income before depreciation expense was $270,393in 2014, and was $273,639in 2013. (Ignore taxes.)

HOLTZMAN COMPANY Comparative Income Statements For the Years 2014 and 2011
2014	2013
Income before depreciation expense	$	$
Depreciation expense
Net income	$	$