Q3. JB Corporation purchased equipment costing $135,000 on January 1, 2018. At that time the useful life of the equipment was estimated to be 12 years and the residual value was estimated to be $7,500. Depreciation up to December 31, 2019 has been recorded using the straight-line method and the company operates on a calendar year basis. On January 1, 2020, the estimated useful life was revised to a total of 10 years and the residual value was revised to $8,000. (20 marks)

Instructions

Prepare the journal entry to record the depreciation expense for 2020. (Show calculations.)