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A company purchased a piece of manufacturing equipment for $30,000 on January 1, 2018. At that...

A company purchased a piece of manufacturing equipment for $30,000 on January 1, 2018. At that time, the company estimated the equipment would have a 7-year useful life and no salvage value. The company used straight-line depreciation based on this information through 2019. On December 31, 2020, the company determined the equipment instead has a 10-year useful life, with no salvage value. The company’s tax rate has been 30% since 2015.

What is the necessary adjustment to beginning retained earnings in 2020 for this change?

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ekkarill92 answered 1 year ago
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