Question

On January 1, 2017, Flowers Unlimited purchased a new delivery van. The van cost $35,000 with an estimated life of 5 years and $5,000 residual value. Double diminishing-balance depreciation will be used. What is the balance in the Accumulated Depreciation account at the end of 2018?

Question 34 options:

	$22,400
	$19,200
	$12,600
	$10,800

Answer 1

Answer: $22,400

Explanation

	Double Declining Balance Depreciation
	Depreciation for the Period	End of Period
Annual Period	Beginning of	Depreciation	Depreciation	Accumulated	Book
	Period Book	Rate	Expense	Depreciation	Value
	Value
2017	$    35,000.00	40%	14,000.00	$    14,000.00	$ 21,000.00
2018	$    21,000.00	40%	8,400.00	$    22,400.00	$ 12,600.00
Depreciation Rate = (100% / 5 years) × 2 = 40% per year
Book Value = Beginning period book value - Depreciation expense