Practice Question In 1990, Blue Company completed the construction of a building at a cost of $2,080,000 and first occupied it in January 1991 It was estimated that the building will have a useful life of 40 years and a salvage value of $62,400 at the end of that time Early in 2001, an addition to the building was constructed at a cost of $520,000 At that time, it was estimated that the remaining life of the building would be, as originally estimated, an additional 30 years, and that the addition would have a life of 30 years and a salvage value of $20,800 In 2019, it is determined that the probable life of the building and addition will extend to the end of 2050, or 20 years beyond the original estimate Using the straight line method, compute the annual depreciation that would have been charged from 1991 through 2000 Annual depreciation from 1991 through 2000 $ yr Compute the annual depreciation that would have been charged from 2001 through 2018 Annual depreciation from 2001 through 2018 $ yr Prepare the entry, if necessary, to adjust the account balances because of the revision of the estimated life in 2019 (If no entry is required, select No entry for the account titles and enter 0 for the amounts Credit account titles are automatically indented when amount is entered Do not indent manually ) Account Titles and Explanation Debit Credit Practice Question In 1990, Blue Company completed the construction of a building at a cost of $2,080,000 and first occupied it in January 1991 It was estimated that the building will have a useful life of 40 years and a salvage value of $62,400 at the end of that time Early in 2001, an addition to the building was constructed at a cost of $520,000 At that time, it was estimated that the remaining life of the building would be, as originally estimated, an additional 30 years, and that the addition would have a life of 30 years and a salvage value of $20,800 In 2019, it is determined that the probable life of the building and addition will extend to the end of 2050, or 20 years beyond the original estimate Using the straight line method, compute the annual depreciation that would have been charged from 1991 through 2000 Annual depreciation from 1991 through 2000 yr Compute the annual depreciation that would have been charged from 2001 through 2018 Annual depreciation from 2001 through 2018 Prepare the entry, if necessary, to adjust the account balances because of the revision of the estimated life in 2019 (If no entry is required, select No entry for the account titles and enter 0 for the amounts Credit account titles are automatically indented when amount is entered Do not indent manually ) Debit Account Titles and Explanation Credit

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Practice Question: In 1990, Blue Company completed the construction of a building at a cost of $2,080,000 and first occupied it in January 1991. It

Practice Question:

In 1990, Blue Company completed the construction of a building at a cost of $2,080,000 and first occupied it in January 1991. It was estimated that the building will have a useful life of 40 years and a salvage value of $62,400 at the end of that time. Early in 2001, an addition to the building was constructed at a cost of $520,000. At that time, it was estimated that the remaining life of the building would be, as originally estimated, an additional 30 years, and that the addition would have a life of 30 years and a salvage value of $20,800. In 2019, it is determined that the probable life of the building and addition will extend to the end of 2050, or 20 years beyond the original estimate.

Using the straight-line method, compute the annual depreciation that would have been charged from 1991 through 2000.

Annual depreciation from 1991 through 2000		$	/ yr.

Compute the annual depreciation that would have been charged from 2001 through 2018.

Annual depreciation from 2001 through 2018		$	/ yr.

Prepare the entry, if necessary, to adjust the account balances because of the revision of the estimated life in 2019. (If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Account Titles and Explanation	Debit	Credit

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Practice Question: In 1990, Blue Company completed the construction of a building at a cost of $2,080,000 and first occupied it in January 1991. It was estimated that the building will have a useful life of 40 years and a salvage value of $62,400 at the end of that time. Early in 2001, an addition to the building was constructed at a cost of $520,000. At that time, it was estimated that the remaining life of the building would be, as originally estimated, an additional 30 years, and that the addition would have a life of 30 years and a salvage value of $20,800. In 2019, it is determined that the probable life of the building and addition will extend to the end of 2050, or 20 years beyond the original estimate. Using the straight-line method, compute the annual depreciation that would have been charged from 1991 through 2000. Annual depreciation from 1991 through 2000 yr Compute the annual depreciation that would have been charged from 2001 through 2018. Annual depreciation from 2001 through 2018 Prepare the entry, if necessary, to adjust the account balances because of the revision of the estimated life in 2019 (If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Debit Account Titles and Explanation Credit