Exercise 11-25 (Algo) Change in principle; change in depreciation methods [LO11-2, 11-6] For financial reporting, Clinton Poultry Farms has used the declining-balance method of depreciation for conveyor equipment acquired at the beginning of 2018 for $2,750,000. Its useful life was estimated to be five years, with a $155,000 residual value. At the beginning of 2021, Clinton decides to change to the straight-line method. The effect of this change on depreciation for each year is as follows: ($ in thousands) Year Straight Line Declining Balance Difference 2018 $ 519 $ 1,100 $ 581 2019 519 660 141 2020 519 396 (123 ) $ 1,557 $ 2,156 $ 599 Required: 2. Prepare any 2021 journal entry related to the change.
