Question
Yuki Manufacturing Company acquired a plant asset for $7000 on January 1,2013 , and depreciated the equipment using the straight-line basis over a 8-year period,
Yuki Manufacturing Company acquired a plant asset for $7000 on January 1,2013 , and depreciated the equipment using the straight-line basis over a 8-year period, with no scrap value. On January 1,2018 , after using the asset for 5 full years, management believes that the asset will be productive for an additional 7 years (as opposed to 3 years). The increase in useful life results from an improved maintenance program initiated 2 years ago. How should report this change in estimate?
Annual depreciation is $_______ per year before the change in estimate. The revised depreciation is $_______per year. Yuki does not make any changes to prior financial statements.
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