Question
Pfizer Inc. Data for the year ended December 31, 2023: Item Amount Property, Plant, and Equipment (PPE) Cost $60,000,000 Accumulated Depreciation $24,000,000 Estimated Salvage Value
Pfizer Inc. Data for the year ended December 31, 2023:
Item | Amount |
Property, Plant, and Equipment (PPE) Cost | $60,000,000 |
Accumulated Depreciation | $24,000,000 |
Estimated Salvage Value | $6,000,000 |
Remaining Useful Life | 8 years |
Annual Depreciation Expense | $4,500,000 |
- Calculate the book value of PPE.
- Determine the new depreciation expense if the estimated useful life is reduced to 6 years.
- Discuss the financial statement impact of this change in estimate.
- Explain why the Conservatism Principle is important in depreciation.
- How should Pfizer record the change in depreciation expense?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Modern Auditing
Authors: Walter Gerry Kell, William C. Boynton, Richard E. Ziegler
5th Edition
0471542830, 9780471542834
