On January 1, 2020, Bauer Co. had purchased a machine for $60,000. This machine had an estimated service life of eight years and an estimated residual value of $4,000. It has been depreciated by the straight-line method since acquisition. On January 1, 2023, it was determined that the remaining service life for this machine was nine years and that the residual value would be $3,000.

Required:

Record the depreciation expense for 2023.

CHART OF ACCOUNTS

Bauer Co.

General Ledger

ASSETS

111 Cash

121 Accounts Receivable

141 Inventory

152 Prepaid Insurance

180 Machinery

198 Accumulated Depreciation-Machinery

LIABILITIES

211 Accounts Payable

221 Notes Payable

224 Interest Payable

231 Salaries Payable

EQUITY

311 Common Stock

331 Retained Earnings

REVENUE

411 Sales Revenue

EXPENSES

500 Cost of Goods Sold

511 Insurance Expense

512 Utilities Expense

521 Salaries Expense

531 Depreciation Expense

532 Bad Debt Expense

559 Miscellaneous Expense