Question
On July 1, 2012, Sparky purchased a machine for $200,000 with a salvage value of $8,000 and useful life of 20 years which was depreciated
On July 1, 2012, Sparky purchased a machine for $200,000 with a salvage value of $8,000 and useful life of 20 years which was depreciated using the straight line method. On July 1, 2016, Sparky decided to change the salvage to $14,255 and a total useful life of 28 years. The bookkeeper used the old estimates in calculating ICO.
Determine the ADJUSTMENT to Sparkys Income from Continuing Operations (ICO) for this item.Sparky has a corporate tax rate of 30%.
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Corporate Financial Accounting
Authors: Carl S Warren, Jeff Jones
16th Edition
0357510380, 978-0357510384
