A company purchased equipment valued at $825,000 on January 1.The equipment has an estimated useful life of seven years or 6 million units.The equipment is estimated to have a salvage value of $35,000.Assuming the double-declining-balance method of depreciation,what is depreciation for the second year?

Question

Quizplus · Accepted Answer

100%/7 = 14.28 * 2 = 28.57% DDB
Year 1: $825,000*.2857 = $235,702 (depreciation)
Year 2: $589,928*.2857 = $168,362 (depreciation)

A Company Purchased Equipment Valued at $825,000 on January 1