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Colorado Consulting Company Has Been Using the Sum-Of-The-Years'-Digits Depreciation Method

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Essay

Colorado Consulting Company has been using the sum-of-the-years'-digits depreciation method to depreciate some office equipment that was acquired at the beginning of 2016. At the beginning of 2018, Colorado Consulting decided to change to the straight-line method. The equipment cost $120,000 and is expected to have no salvage value. The estimated useful life of the equipment is five years. Ignore income taxes.
Required:
1. Prepare the appropriate journal entry, if any, to record the accounting change.
2. Prepare the journal entry to record depreciation for 2018.


Definitions:

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