Question $3$

TechnoCorp uses straight$-$line depreciation on all of its depreciable assets. The company records

annual depreciation expense at the end of each calendar year. On May $15,2018,$ the company

purchased a piece of equipment costing $$120,000.$ The equipment's useful life was estimated to be $15$

years with an estimated residual value of $$30,000.$ Depreciation for partial years is recorded as half

year convention.

In $2022,$ after almost four years of experience with the equipment, management decided to revise its

estimated life from $15$ years to $25$ years. No change was made in the estimated residual value. The

revised estimate of the useful life was decided prior to recording annual depreciation expense for the

year ended December $31,2022.$

Required:

Prepare journal entries in chronological order for the given events, beginning with the purchase of the

equipment on May $15,2018.$ Show separately the recording of depreciation expense in $2018$ through