Moreno Company purchased equipment for $900,000 on January 1, 2014, and will use the double-declining-balance method of depreciation. It is estimated that the equipment will have a 3-year life and a $40,000 salvage value at the end of its useful life. The amount of depreciation expense recognized in the year 2016 will be

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In 2016, the equipment is in its third year of depreciation. The double-declining-balance method calculates depreciation based on the book value at the beginning of the year. By 2016, the book value is reduced to $120,000, and the depreciation expense is limited to the remaining book value minus the salvage value, which is $60,000.

Moreno Company Purchased Equipment for $900,000 on January 1, 2014