Surplus Warehouse purchased a forklift on January 1, 2017, for $12,000. The forklift is expected to last for five years and have a residual value of $1,200. Surplus Warehouse uses the double-declining-balance method for depreciation.

Required
1.Calculate the depreciation expense,accumulated depreciation,and book value for each year of the forklift's life.
2.Analyze the impact of the entry to record depreciation expense for 2017.
3.What factors may have influenced Surplus Warehouse to use the double-declining-balance method?

Question

Surplus Warehouse purchased a forklift on January 1, 2017, for $12,000. The forklift is expected to last for five years and have a residual value of $1,200. Surplus Warehouse uses the double-declining-balance method for depreciation.

Required
1.Calculate the depreciation expense,accumulated depreciation,and book value for each year of the forklift's life.
2.Analyze the impact of the entry to record depreciation expense for 2017.
3.What factors may have influenced Surplus Warehouse to use the double-declining-balance method?

Quizplus · Accepted Answer

The Answer of Surplus Warehouse purchased a forklift on January 1, 2017, for $12,000. The forklift is expected to last for five years and have a residual value of $1,200. Surplus Warehouse uses the double-declining-balance method for depreciation.

Required
1.Calculate the depreciation expense,accumulated depreciation,and book value for each year of the forklift's life.
2.Analyze the impact of the entry to record depreciation expense for 2017.
3.What factors may have influenced Surplus Warehouse to use the double-declining-balance method?

Surplus Warehouse Purchased a Forklift on January 1, 2017, for $12,000