Sheridan Company purchased a machine on January 1, 2019, for $837000. At the date of acquisition, the machine had an estimated useful life of 6 years with no salvage. The machine is being depreciated on a straight-line basis. On January 1, 2022, Sheridan determined, as a result of additional information, that the machine had an estimated useful life of 8 years from the date of acquisition with no salvage. An accounting change was made in 2022 to reflect this additional information. Assume that the direct effects of this change are limited to the effect on depreciation and the related tax provision, and that the income tax rate was 30% in 2019, 2020, 2021, and 2022. What should be reported in Sheridan's income statement for the year ended December 31, 2022, as the cumulative effect on prior years of changing the estimated useful life of the machine? 000 O $83700 O $418500 O $0 O $55800

Sheridan Company purchased a machine on January 1, 2019, for $837000. At the date of acquisition, the machine had an estimated useful life of 6 years with no salvage. The machine is being depreciated on a straight-line basis. On January 1, 2022, Sheridan determined, as a result of additional information, that the machine had an estimated useful life of 8 years from the date of acquisition with no salvage. An accounting change was made in 2022 to reflect this additional information. Assume that the direct effects of this change are limited to the effect on depreciation and the related tax provision, and that the income tax rate was 30% in 2019, 2020, 2021, and 2022. What should be reported in Sheridan's income statement for the year ended December 31, 2022, as the cumulative effect on prior years of changing the estimated useful life of the machine? 000 O $83700 O $418500 O $0 O $55800

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter22: Accounting For Changes And Errors.

Section: Chapter Questions

Problem 5MC: During 2019, White Company determined that machinery previously depreciated over a 7-year life had a...

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