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Dear Sir,
i would like to know how to pass the entries for this.I purchased $1000 worth furniture. the rate of depreciation is 20%. Actually i completed 3 years depreciation according to the rate of 20%. Now from 4th year onwards i like to change to depreciation rate from 20% to 10%. How can i pass the entries for new depreciation and adjustment of old depreciation.
I am very much thankful to you for your valuable advise.
Regards
Haridas Pandarathil
Email: nair_pandarathil68@yahoo.comDon’t adjust for the previous 3 years. From year 4, depreciate at the rate of 10%
However, if you mean that the three-year old asset now has a revised estimated useful life of 10 MORE years, depreciate at the rate of (100-60)/10 = 4 per annum.
If you mean that your original estimate of a 5 year life should have been a 10 year estimate, depreciate (100-60)/ 7 = 5.714 each year for the next / remaining 7 years of its life
Sir what should we do to installation costs paid to 1)specialists 2)own labourers what should be capitalised
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