Question

exercises Saved Required information (The following information applies to the questions displayed below Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the year at a cost of $84,200. The machine's useful life is estimated at 20 years, or 391,000 units of product, with a $6,000 salvage value. During its second year, the machine produces 33,100 units of product Determine the machine's second-year depreciation using the double-declining-balance method. Double-declining-balance Depreciation Annual Depreciation Expense Depreciation expense Choose Factors: Choose Factor(%) First year's depreciation Second year's depreciation X < Prex of 5 Next

Answer 1

Double -declining -balance Depreciation
Formula:
= 2 × Straight-line depreciation rate × Book value of Asset
Straight Line Depreciation rate = 1/20 = 5%
Depreciation rate = 2 *5% = 10%
	Choose factors	x	Choose Factors (%)	=	Annual Depreciation Expense
	Book value of machine	x	Depreciation rate	=	Depreciation expense
First year's depreciation	84200	x	10%	=	8420
Second year's depreciation	75780	x	10%	=	7578