On January 1, Wallace Inc. purchased a new machine for $96,000. Its estimated useful life is 10 years with an expected salvage value of $16,000. Assuming double-declining balance depreciation, depreciation expense for the first year is:

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The double-declining balance depreciation rate is 2 times the straight-line rate. The straight-line rate is 1/10 (10 years) = 10%. Double that is 20%. So, for the first year, the depreciation expense is 20% of $96,000, which is $19,200.