A company purchased office equipment for $40,000 and estimated a salvage value of $8,000 at the end of its 5-year useful life. The constant percentage to be applied against book value each year if the double-declining-balance method is used is

Question

Quizplus · Accepted Answer

The double-declining-balance method uses twice the straight-line rate. The straight-line rate is 1/5 or 20% for a 5-year life, so the double-declining rate is 40%.

A Company Purchased Office Equipment for $40,000 and Estimated a Salvage