Equipment Was Acquired on January 1, 2011, at a Cost

question 109

Essay

Equipment was acquired on January 1, 2011, at a cost of $170,000. The equipment was originally estimated to have a salvage value of $10,000 and an estimated life of 10 years. Depreciation has been recorded through December 31, 2013, using the straight-line method. On January 1, 2014, the estimated salvage value was revised to $16,000 and the useful life was revised to a total of 8 years.
Instructions
Determine the depreciation expense for 2014.

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Definitions:

Government

The organization, machinery, or agency through which a political unit exercises authority and performs functions and which is usually classified as democratic, authoritarian, etc.

Excise Tax

Excise tax is a type of tax charged on specific goods, services, and activities, such as alcohol, tobacco, and fuel, usually to discourage their use or generate revenue.

Consumers' Burden

The part of the incidence of a tax borne by consumers, often reflected in higher prices or reduced consumption of taxed goods.

Efficiency Loss

The reduction in economic productivity that happens when the balance for a product or service is either not attained or unattainable.