Krause Corporation purchased factory equipment that was installed and put into service January 2, 2010, at a total cost of $60,000.Residual value was estimated at $4,000.The equipment is being depreciated over four years using the double-declining balance method.For the year 2011, Krause should record depreciation expense on this equipment of

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The double-declining balance method calculates depreciation by doubling the straight-line rate. The straight-line rate is 1/4 (25%) for four years. Double that rate is 50%. For 2010, depreciation is 50% of $60,000 = $30,000. The book value at the start of 2011 is $60,000 - $30,000 = $30,000. Depreciation for 2011 is 50% of $30,000 = $15,000.

Krause Corporation Purchased Factory Equipment That Was Installed and Put