Western Company Purchased Some Equipment on January 2, 2008, for $24,000

Multiple Choice

Western Company purchased some equipment on January 2, 2008, for $24,000. The company used straight-line depreciation based on a ten-year estimated life with no residual value. During 2011, management decided that this equipment could be used only three more years and then would be replaced with a technologically superior model. What entry should the company make as of January 1, 2011, to reflect this change?

A) No entry
B) Debit a Prior Period Adjustment account for $4,800 and credit accumulated depreciation for $4,800.
C) Debit Retained Earnings for $4,800 and credit accumulated depreciation for $4,800.
D) Debit Depreciation Expense for $4,800 and credit Accumulated Depreciation for $4,800.