Example: You place an asset in service in Year 1, Quarter 1. The recoverable cost is $4,000, the life is 4 years, and you are using the 200 declining balance depreciation method. In Year 2, Quarter 1, you change the depreciation method to straight-line.
| Account Description | Debit | Credit |
|---|---|---|
| Depreciation Expense | 250.00 | |
| Accumulated Depreciation | 750.00 | |
| Depreciation Expense (adjustment) | 1,000.00 |
| Account Description | Debit | Credit |
|---|---|---|
| Depreciation Expense | 166.67 | |
| Accumulated Depreciation | 166.67 |