On January 2, 2009, McKell Company Acquired Machinery at a Cost

question 51

Multiple Choice

On January 2, 2009, McKell Company acquired machinery at a cost of $640,000. This machinery was being depreciated by the double-declining-balance method over an estimated useful life of eight years, with no residual value. At the beginning of 2011, McKell decided to change to the straight-line method of depreciation. Ignoring income tax considerations, the cumulative effect of this accounting change is

• A) $0.
• B) $120,000.
• C) $130,000.
• D) $280,000.

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