FeelGood Corp.purchased equipment on January 1,2017 for $275,000.It was estimated that the equipment would have a residual value of $25,000 at the end of its useful life.The asset's useful life was estimated at 5 years or 10,000 units of output.The company has a December 31 year end.Assuming the double-declining-balance depreciation method is used,what is the net book value (carrying value)of the asset on December 31,2018?

Question

Quizplus · Accepted Answer

B)DDB rate 2/5 = 40%
2017 deprec.275,000 × 40% = 110,000
2018 deprec.(275,000 - 110,000)× 40% = 66,000
NBV @ 12/31/12 = 275,000 - 110,000 - 66,000 = 99,000