Question 6 On October 1, 2019, Crane Manufacturing Company purchased a piece of high-tech equipment for $90,000 cash. Crane estimated the equipment would have a 7-year useful life and a residual value of $8,800. The company uses straight-line depreciation and has a September 30 fiscal year end. On October 1, 2021, Crane paid $15,500 cash to upgrade the equipment. It is expected that the upgrade will significantly reduce the operating costs of the equipment. Crane also reviewed the equipment's expected useful life and estimated that, due to changing technology, the equipments total expected useful life will be 6 years and its residual value will be $4,900. |