Depreciation | Change in Useful Life

Companies sometimes revise the estimated useful life and/or expected residual value for fixed assets. If this happens, you don't need to restate the financial statements for prior periods. Instead, you just need to use the revised figures to calculate depreciation going forward.
If the company uses the straight-line depreciation method, for example, the new annual depreciation expense would be calculated as follows:
(net book value - new residual value) / new remaining useful life
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