Holtzman Company is in the process of preparing its financial statements for 2020. Assume that no entries for depreciation have been recorded in 2020. The following information related to depreciation of fixed assets is provided to you. 1. Holtzman purchased equipment on January 2, 2017, for $76,500. At that time, the equipment had an estimated useful life of 10 years with a $4,500 residual value. The equipment is depreciated on a straight-line basis. On January 2, 2020, as a result of additional information, the company determined that the equipment has a remaining useful life of 4 years with a $2,700 residual value. During 2020, Holtzman changed from the double-declining-balance method for its building to the straight-line method. The building originally cost $270,000. It had a useful life of 10 years and a residual value of $27,000. The following calculations present depreciation on both bases for 2018 and 2019. 2. Straight- Double-Declining Line -Balance 2018 $24,300 $54,000 2019 24,300 43,200 3. Holtzman purchased a machine on July 1, 2018, at a cost of $108,000. The machine has a residual value of $14,400 and a useful life of 8 years. Holtzman's bookkeeper recorded straight-line depreciation in 2018 and 2019 but failed to consider the residual value. Prepare the journal entries to record depreciation expense for 2020 and correct any errors made to date related to the information provided. (Ignore income tax considerations.) (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 for the amounts.) No. Account Titles and Explanation Debit Credit 1. 2. 3. (To record depreciation expense.) (To record correction of depreciation recorded.) List of Accounts Show comparative net income for 2019 and 2020. Income before depreciation expense was $270,000 in 2020 and $279,000 in 2019. (Ignore income tax considerations.) HOLTZMAN COMPANY Statement of Income (partial) For the Years 2020 and 2019 2020 2019 $ $ List of Accounts