For financial reporting, Clinton Poultry Farms has used the declining-balance method of depreciation for conveyor...
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Accounting
For financial reporting, Clinton Poultry Farms has used the declining-balance method of depreciation for conveyor equipment acquired at the beginning of 2018 for $2,688,000. Its useful life was estimated to be six years with a $192,000 residual value. At the beginning of 2021, Clinton decides to change to the straight-line method. The effect of this change on depreciation for each year is as follows:
($ in thousands)
Year
Straight-Line
Declining Balance
Difference
2018
$
416
$
896
$
480
2019
416
597
181
2020
416
398
(18
)
$
1,248
$
1,891
$
643
Required:2. Prepare any 2021 journal entry related to the change. (Enter your answers in dollars. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
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