Golden Dollar Company purchased a machine on January 1, 2019 for $360,000, with a 5-year life, and a $36,000 residual life.
If Compute the book value of the machine on December 31, 2021 if the company uses the double-declining balance method of depreciation.

Question

Quizplus · Accepted Answer

$360,000 x 2/5 = $144,000
($360,000 - $144,000) x 2/5 = $86,400
($216,000 - $86,400) x 2/5 = $51,840
$360,000 - ($144,000 + $86,400 + $51,840) = $77,760

Golden Dollar Company Purchased a Machine on January 1, 2019