Stacey Corp. has been depreciating equipment over a 10-year life on a straight-line basis. The equipment, which cost $28,000, was purchased on 1 January 20X1. It has an estimated residual value of $7,300. On the basis of experience since acquisition, management has decided in 20X5 to depreciate it over a total life of 14 years instead of 10 years, with no change in the estimated residual value. The change is to be effective on 1 January 20X5. The 20X5 financial statements are prepared on a comparative basis; 20X4 and 20X5 incomes before depreciation were $53,500 and $55,800, respectively. Disregard income tax considerations. Required: 1-a. Analyze the effects of the change. (Amounts to be deducted should be indicated by a minus sign.) Analysis: Cost Accumulated depreciation to date Residual value To be depreciated Annual depreciation (SL): Per year 20X1 $ 0 $ 20X5