Long answer 3

*LONG ASWER QUESTION 3 MUST BE ANSWERED* Seinfeld Company is preparing its 2020 financial statements. No entries for depreciation have been recorded in 2020. The following is information related to the depreciation of fixed assets: 1. Seinfeld bought equipment on Jan 2, 2017, for $86,700. At the time of purchase, the equipment was estimated to have a useful life of 10 years and a $5,100 residual value. The equipment is depreciated on a straight-line basis. On Jan 2, 2020, upon receiving new information, the company determined that the equipment has a remaining useful life of 4 years with a $3,060 residual value. 2. During 2020, Seinfeld changed from the double-declining-balance method for its building to the straight-line method. The building originally cost $306,000. It had a useful life of 10 years and a residual value of $30,600. The following calculations present depreciation on both bases for 2018 and 2019. Straight- Line $27,540 Double-Declining -Balance $61.200 2018 2019 27,540 48.960 3. Seinfeld purchased a machine on July 1, 2018, at a cost of $122,400. The machine has a residual value of $16,320 and a useful life of 8 years. Seinfeld's bookkeeper recorded straight- line depreciation in 2018 and 2019 but failed to consider the residual value. Required: 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.)