Pinnacle Corporation Has Been Using the Straight-Line Depreciation Method to Depreciate

question 67

Essay

Pinnacle Corporation has been using the straight-line depreciation method to depreciate some office equipment that was acquired at the beginning of 2010. At the beginning of 2013, Pinnacle decided to change to the sum-of-the-years'-digits method. The equipment cost $120,000 and is expected to have no salvage value. The estimated useful life of the equipment is five years. The tax rate is 30%.
Required:
Prepare the journal entry, if any, to record the accounting change at the beginning of 2013.

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Definitions:

Drug Tolerance

A state where an individual's reaction to a drug decreases with its continued use, leading to the need for higher doses to achieve the same effect.

Dependency

A state of relying on or being controlled by something or someone else for support or existence.

Pseudoinsomnia

A sleep disorder in which an individual believes they have not slept, despite evidence of normal sleep patterns.

Habituated

The process of becoming accustomed to a stimulus or environment, leading to a decrease in response over time.