question archive Included in depreciation expense above was depreciation on certain machinery that was purchased on 2 Jan 2014 for $450,000 and which had been depreciated on a straight-line basis over its useful life of 15 years with zero salvage value
Included in depreciation expense above was depreciation on certain machinery that was purchased on 2 Jan 2014 for $450,000 and which had been depreciated on a straight-line basis over its useful life of 15 years with zero salvage value
Subject:AccountingPrice: Bought3
Included in depreciation expense above was depreciation on certain machinery that was purchased on 2 Jan 2014 for $450,000 and which had been depreciated on a straight-line basis over its useful life of 15 years with zero salvage value. During the review, the company decided that, as from 2019, the useful life of the machinery should be revised to 10 years (i.e. 10 years from purchase date) because of rapid technological obsolescence. At the same review, the company also discovered that certain office equipment purchased on 2 Jan 2017 for $150,000 had been erroneously expensed entirely in 2017 as operating expenses when it should instead have been depreciated on a straight-line basis over 5 years with zero salvage value.
