Question

Brief Exercise 9-6 a-b Crane Ltd. purchased a delivery truck on January 1, 2018, at a cost of $74,400. The truck is expected to have a residual value of $8,160 at the end of its 4-year useful life. Crane has a December 31 year end. Use the diminishing-balance method and assume the depreciation rate is equal to double the straight-line rate. Calculate the depreciation for each year of the truck's life. (Round answers to 0 decimal places, e.g. 5,275.) Depreciation expense 2018 2019 2020 2021 Calculate the depreciation in total over the truck's life. Total depreciation expense

Answer 1

Double Declining Balance Method
Useful Life		4	Years
Cost		$                                74,400
Residual Value		$                                  8,160
Depreciable Value		$                                66,240
Depreciation Rate		50.00%
Year	Depreciation Expenses	Acc Depreciation	Book Value End Of Year
2018	$                                    37,200	$                                37,200	$                                37,200
2019	$                                    18,600	$                                55,800	$                                18,600
2020	$                                      9,300	$                                65,100	$                                  9,300
2021	$                                      1,140	$                                66,240	$                                  8,160
	(Dep rate:12.26% for last year)
Total Depreciation	$                                    66,240