Question

Required information [The following information applies to the questions displayed below.] On April 1, Cyclone's Co. purchases a trencher for $304,000. The machine is expected to last five years and have a salvage value of $52,000. Compute depreciation expense at December 31 for both the first year and second year assuming the company uses the double- declining-balance method. (Enter all amounts as positive values.) Depreciation for the Period End of Period begind Book Depreciation Rate Partial Depreciation Annual Period Depreciation Year Expense Accumulated Depreciation Book Value Period Book Value $ 304,000 De Year 1 0 0 $ $ Year 2 | $

Answer 1

Double Decline Depreciation Depreciation for the period End of Period Beginning of period Depreciation Partial Annual Accumulated Year end Annual period Book value Rate Year Depreciation Expenses Depreciation book value Year 11 304000 L 40% 9/12 91200 91200 2 12800 Year 2 212800 40% 12/12 85120 176320 127680 Depreciation rate =(1/ life of the machine)*2