Page 2 of 2 4. Sarah NV purchased a piece of equipment for $ 125.000. It is estimated a 5-year life and 17.500 residual value. At the end of year four (before the depreciation adjustment), it estimate the new total useful-life to be 8 years and new residual value to be $ 20,000. Using straight line method, compute the carrying amount of equipment prior to revision, new cost, and revised depreciation. Points: 10