Question

Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the year at a cost of $86,800. The machine's useful life is estimated at 20 years, or 404,000 units of product, with a $6,000 salvage value. During its second year, the machine produces 34,400 units of product. 

Determine the machine's second-year depreciation using the double-declining-balance method. 

Double-declining-balance Depreciation
	Choose Factors:	x	Choose Factor(%)	=	Annual Depreciation Expense
		x		=	Depreciation expense
First year's depreciation		x		=
Second year's depreciation		x		=

Answer 1

Double Declining balance Method Rate of Depreciation = (1/ Life)*2 Depreciation Rate = (1/20)*2 Cost of the Machine 10% 86800 Double Declining balance Depreciation Choose Facors: Choose Factor (%) Annual Depreciation Expenses Depreciation Expenses Per unit 8060 7254 First Year's Depreciation Second Year's depreciation Beginning Book Value 80600 72540 Double the Straight line rate 10% 10%