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Nowling Company buys a machine for $85,000 on January 1, 2012. A residual value of $5,000 and a useful life of 10 years are estimated
Nowling Company buys a machine for $85,000 on January 1, 2012. A residual value of $5,000 and a useful life of 10 years are estimated at the acquisition date. Nowling uses straight-line depreciation. Early in 2016, Nowling discovers that a competitor has come out with a new product that will reduce demand for Nowling's product. As a result, it estimates that the machine will no longer be of use after 2018. Nowling believes it will be able to sell the machine to a scrap dealer for $8,000 at that time. Prepare a depreciation schedule comparing the original depreciation schedule (for 2012-2021) with the depreciation schedule based on the revised estimates of useful life and residual value (for 2012-2018). Show all amounts in thousands of dollars (rounded to the nearest tenth)
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