Marlow Company purchased a point of sale system on January 1 for $3,400.This system has a useful life of 10 years and a salvage value of $400.What would be the depreciation expense for the first year of its useful life using the double-declining-balance method?
A)$680.
B)$2,320.
C)$2,720.
D)$600.
E)$300.

Question

Quizplus · Accepted Answer

The double-declining-balance method calculates depreciation by doubling the straight-line rate. The straight-line rate is 1/10 = 10%. Double that is 20%. The first year's depreciation is 20% of $3,400, which is $680.

Marlow Company Purchased a Point of Sale System on January