Sandeep Inc. uses double-declining-balance depreciation for an asset with a 4-year life expectancy and no salvage value. Depreciation expense for the second year of the asset's life is calculated by:

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Quizplus · Accepted Answer

The double-declining-balance method of depreciation involves multiplying the book value of the asset at the beginning of the year by twice the straight-line rate (which is 1/life expectancy, here 1/4). Since there's no salvage value, the formula simplifies to [2 x Book Value]/4 for any given year, including the second year.