Question

Question 4 View Policies Current Attempt in Progress Culver Company acquires a delivery truck at a cost of $76,000. The truck is expected to have a salvage value of $6,000 at the end of its 4-year useful life. Assuming the declining-balance depreciation rate is double the straight-line rate, compute annual depreciation for the first and second years under the declining-balance method. Year 1 Year 2 Annual depreciation expense $

Answer 1

Double decline method Choose Factors: Choose Factors(%) Cost x Depreciation rate 76000 50% 38000 50% = | = | Annual Depreciation Expense Depreciation expense 38000 19000 Year 1 Depreciation Year 2 Depreciation Depreciation rate = (1/4)*2 = 50%