On January 1, 2016, Chipmunk Company purchased new equipment for $440,000. The equipment had an estimated $40,000 salvage value at the end of its estimated ten-year useful life. Straight-line depreciation has been recorded. Before adjusting the accounts for 2022, Chipmunk extends the useful life of the equipment by four years and decreases the salvage value to $20,000.
Required:
a. Calculate the 2022 depreciation expense.
b. What is the equipment's book value at the end of 2022 after recording the 2022 depreciation expense?

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The Answer of On January 1, 2016, Chipmunk Company purchased new equipment for $440,000. The equipment had an estimated $40,000 salvage value at the end of its estimated ten-year useful life. Straight-line depreciation has been recorded. Before adjusting the accounts for 2022, Chipmunk extends the useful life of the equipment by four years and decreases the salvage value to $20,000.
Required:
a. Calculate the 2022 depreciation expense.
b. What is the equipment's book value at the end of 2022 after recording the 2022 depreciation expense?

On January 1, 2016, Chipmunk Company Purchased New Equipment for $440,000