On January 1, 2019, Sabrina Company acquired equipment for $480,000. The estimated life of the equipment is 5 years or 20,000 hours. The estimated residual value is $80,000.
What is the amount of depreciation expense for 2020, if the company uses the double-declining-balance method of depreciation?

Question

Quizplus · Accepted Answer

$480,000 x 2/5 = $192,000
($480,000 - $192,000) x 2/5 = $115,200
($288,000 - $115,200) x 2/5 = $69,120

On January 1, 2019, Sabrina Company Acquired Equipment for $480,000