Question 8 The double-declining-balance method of depreciation causes the same amount of depreciation in the early...
Question 8
-
The double-declining-balance method of depreciation
causes the same amount of depreciation in the early years of an asset's use as compared to other depreciation methods.
is not an acceptable depreciation method according to generally accepted accounting principles.
causes more depreciation in the early years of an asset's use as compared to other depreciation methods.
causes less depreciation in the early years of an asset's use as compared to other depreciation methods.
None of the above
Homework Answers
The double declining balance method of depreciation causes more depreciation in the early years of an asset's use as compared to other depreciation methods.
Under double declining balance method of depreciation, the depriciation charge gets decreased over the life of the asset, as depriciation is charged on higher value of an asset in the first year, then it gets lower because value of asset has decreased substantially.
Therefore, the correct answer is option 3rd.
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Question 8
The double-declining-balance method of depreciation
causes the same amount of depreciation in the early...
The double-declining - balance method of depreciation causes: O A. the same amount of depreciation in...
The double-declining - balance method of depreciation causes: O A. the same amount of depreciation in early years of an asset's use as compared to other depreciation methods O B. more depreciation in early years of an asset's use as compared to other depreciation methods O c. less depreciation in early years of an asset's use as compared to other depreciation methods OD. is not an acceptable depreciation method according to GAAP A loss is recorded on the sale of...
The total depreciation across the years of an asset's life is the same under the double-declining-balance...
The total depreciation across the years of an asset's life is the same under the double-declining-balance method or the straight-line method. True or False
How do I use the double-declining-balance method, a time-based method, to calculate the depreciation expense for...
How do I use the double-declining-balance method, a time-based
method, to calculate the depreciation expense for Asset A in year
2017?
Depreciation Methods Vorst Corporation's schedule of depreciable assets at December 31, 2016, was as follows: Asset Cost Accumulated Acquisition Residual Depreciation Date Value $ 64,000 2015 $20,000 36,000 2014 10,000 A $100,000 B 55,000 с 70,000 33,600 2014 14,000 $225,000 $133,600 $44,000 Vorst takes a full year's depreciation expense in the year of an asset's acquisition and no depreciation...
The following table demonstrates the double-declining balance method for the same asset. The depreciation rate is...
The following table demonstrates the double-declining balance method for the same asset. The depreciation rate is equal to double the depreciation rate for the straight-line method. The annual depreciation in the straight-line method is $2,000. Therefore the depreciation rate is $2,000 divided by $10,000, which is 20%. In the double-declining balance method this rate is doubled to 40%. Fill up the blanks. Year Book value (start of year) Depreciation Rate Depreciation expense Accumulated Depreciation Book value (year end) 1 10000 40%...
Double-declining-balance depreciation In early January 2016, NewTech purchases computer equipment for $154,000 to use in operating...
Double-declining-balance depreciation
In early January 2016, NewTech purchases computer equipment for $154,000 to use in operating activities for the next four years. It estimates the equipment's salvage value at $25,000. Prepare a table showing depreciation and book value for each of the four years assuming double- declining-balance depreciation. Double-declining-balance depreciation Depreciation for the Period End of Period Accumulated Depreciation Depreciation Book Value Beginning-Year Depreciation Annual Year-End Year Book Value Rate 2016 2017 2018 2019 Total 50% 50% 50% 50%
1. Total depreciation expense over 5 years will be more with the double-declining balance method than...
1. Total depreciation expense over 5 years will be more with the double-declining balance method than with straight line method. a. True b. False 2. Once a company selects the depreciation method they want to use, it must use the same method for all subsequent fixed asset acquisitions. a. True b. False 3. Mitchell's Motors purchased equipment for $72,000 on January 1, 2018. The equipment is expected to have a five-year life and a residual value of $6,000. Using the...
How is depreciation allocated when using the declining-balance method? Question 3 options: A constant percentage of...
How is depreciation allocated when using the declining-balance method? Question 3 options: A constant percentage of an asset's book value as of the beginning of each period is allocated to depreciation expense Depreciation expense is allocated in proportion to an asset's use in operations An equal amount of depreciation expense is allocated each period of an asset's useful life
Explain depreciation. What are the arguments for using the double-declining balance method of depreciation? (0) Explain...
Explain depreciation. What are the arguments for using the
double-declining balance method of depreciation?
(0) Explain depreciation. What are the arguments for using the double declining balance method of depreciation?
Exercise 8-6 Double-declining-balance depreciation LO P1
Exercise 8-6 Double-declining-balance depreciation LO P1 Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the year at a cost of $60,000. The machine's useful life is estimated at 10 years, or 450,000 units of product, with a $6,000 salvage value. During its second year, the machine produces 49,000 units of product. Determine the machine's second-year depreciation using the double-declining-balance method. Double-declining-balance Depreciation Choose Factors:xChoose Factor(%)=Annual...
The double-declining balance method is applied by (1) calculating the asset's straight-line depreciation rate, (2) doubling...
The double-declining balance method is applied by (1) calculating the asset's straight-line depreciation rate, (2) doubling it, (3) subtracting residual value from cost, and (4) multiplying the rate times the cost. * O True False
The double-declining - balance method of depreciation causes: O A. the same amount of depreciation in early years of an asset's use as compared to other depreciation methods O B. more depreciation in early years of an asset's use as compared to other depreciation methods O c. less depreciation in early years of an asset's use as compared to other depreciation methods OD. is not an acceptable depreciation method according to GAAP A loss is recorded on the sale of...
How do I use the double-declining-balance method, a time-based
method, to calculate the depreciation expense for Asset A in year
2017?
Depreciation Methods Vorst Corporation's schedule of depreciable assets at December 31, 2016, was as follows: Asset Cost Accumulated Acquisition Residual Depreciation Date Value $ 64,000 2015 $20,000 36,000 2014 10,000 A $100,000 B 55,000 с 70,000 33,600 2014 14,000 $225,000 $133,600 $44,000 Vorst takes a full year's depreciation expense in the year of an asset's acquisition and no depreciation...
Double-declining-balance depreciation
In early January 2016, NewTech purchases computer equipment for $154,000 to use in operating activities for the next four years. It estimates the equipment's salvage value at $25,000. Prepare a table showing depreciation and book value for each of the four years assuming double- declining-balance depreciation. Double-declining-balance depreciation Depreciation for the Period End of Period Accumulated Depreciation Depreciation Book Value Beginning-Year Depreciation Annual Year-End Year Book Value Rate 2016 2017 2018 2019 Total 50% 50% 50% 50%
1. Total depreciation expense over 5 years will be more with the double-declining balance method than with straight line method. a. True b. False 2. Once a company selects the depreciation method they want to use, it must use the same method for all subsequent fixed asset acquisitions. a. True b. False 3. Mitchell's Motors purchased equipment for $72,000 on January 1, 2018. The equipment is expected to have a five-year life and a residual value of $6,000. Using the...
Explain depreciation. What are the arguments for using the
double-declining balance method of depreciation?
(0) Explain depreciation. What are the arguments for using the double declining balance method of depreciation?
The double-declining balance method is applied by (1) calculating the asset's straight-line depreciation rate, (2) doubling it, (3) subtracting residual value from cost, and (4) multiplying the rate times the cost. * O True False
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