## (Solution Download) Exercise 11-12 In 1987, Herman Moore Company completed the construction of a building at a cost of \$

Exercise 11-12

In 1987, Herman Moore Company completed the construction of a

building at a cost of \$2,740,000 and first occupied it in January

1988. It was estimated that the building will have a useful life of

40 years and a salvage value of \$82,200 at the end of that

time.

Early in 1998, an addition to the building was constructed at a

cost of \$685,000. At that time, it was estimated that the remaining

life of the building would be, as originally estimated, an

additional 30 years, and that the addition would have a life of 30

years and a salvage value of \$27,400.

In 2016, it is determined that the probable life of the building

and addition will extend to the end of 2047, or 20 years beyond the

original estimate.

Using the straight-line method, compute the annual depreciation

that would have been charged from 1988 through 1997.

(Round answer to 0 decimal places, e.g.

45,892.)

 Annual depreciation from 1988 through 1997 \$ / yr

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Compute the annual depreciation that would have been charged

from 1998 through 2015. (Round answer to 0 decimal

places, e.g. 45,892.)

 Annual depreciation from 1998 through 2015 \$ / yr

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Prepare the entry, if necessary, to adjust the account balances

because of the revision of the estimated life in 2016.

(If no entry is required, select "No entry" for the

account titles and enter 0 for the amounts. Credit account titles

are automatically indented when amount is entered. Do not indent

manually.)

 Account Titles and Explanation Debit Credit

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Compute the annual depreciation to be charged, beginning with

2016. (Round answer to 0 decimal places, e.g.

45,892.)

 Annual depreciation expenseAc???building \$

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