A plant asset has a cost of $48,000 and a residual value of $12,000.The asset has a three-year life.If depreciation in the second year amounted to $4,000, which depreciation method was used?

Question

Quizplus · Accepted Answer

The double declining-balance method results in a constant depreciation expense over the asset's life. In this case, the depreciation expense in the second year is $4,000, which is equal to 2/3 of the remaining book value of the asset at the beginning of the year.

A Plant Asset Has a Cost of $48,000 and a Residual