Question

Double Declining Balance Method -- Commercial Lawn Mower: Acquired January 1. Purchased for $14,000; salvage value...

Double Declining Balance Method -- Commercial Lawn Mower: Acquired January 1. Purchased for $14,000; salvage value is $2,000. Useful life is 5 years.

A. Is the salvage value used to compute book value (circle the answer)? Yes or No

B. How is the double declining rate computed?

C.Complete the following Double Declining Balance Table:

Year Book Value: Start of Year DDB Percent Annual Depreciation Expense Accumulated Depreciation Book Value: End of Year
Year 1
Year 2
Year 3
Year 4
Year 5

D. What amount must the balance in the accumulated depreciation account equal in year 4?

E. In which year does the Straight Line Depreciation expense exceed the Double-Declining Balance Depreciation?

F. How does the depreciation requirement after calculations in year 4?

Homework Answers

Answer #1

A. Yes

B. DDB depreciation rate = 2 X (1/useful life) X 100

= 2X(1/5) X 100

=40%

C. DDB table:

D. Answer: $12186

E. 3rd year ( as per SL depreciation $2400 and as per DDB $2016)

F. Answer: $ 726

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Units of Activity - Commercial Lawn Mower: Acquired January 1. Purchased for $14,000 salvage value is...
Units of Activity - Commercial Lawn Mower: Acquired January 1. Purchased for $14,000 salvage value is $2,000. Useful life is 5 years, Total units of activity = 6,250 hours. A. What is the depreciable cost amount? B. Show your computation to calculate the depreciation rate per hour. C. Will the depreciation rate change from year to year? Yes or No D. Complete the following Units of Activity Depreciation table for the first five years they use the equipment: Year Hours...
Using the Double Declining Balance (DDB) depreciation method for equipment with an initial cost of $282,000,...
Using the Double Declining Balance (DDB) depreciation method for equipment with an initial cost of $282,000, an anticipated useful life of 10 years, and a salvage value of $35,250, calculate the (a) depreciation rate, d=?, (b) the Depreciation charge, D=?, at the end of year 2, and (c) the Book Value, BV=?, at the end of year 2.
"Compute the book value at the end of 5 years using double-declining-balance (DDB) depreciation schedule for...
"Compute the book value at the end of 5 years using double-declining-balance (DDB) depreciation schedule for the following asset: Cost of the asset, I: $298,000. Useful life, N: 7 years. Salvage value, S: $35,000."
"Compute the book value at the end of 4 years using double-declining-balance (DDB) depreciation schedule for...
"Compute the book value at the end of 4 years using double-declining-balance (DDB) depreciation schedule for the following asset: Cost of the asset, I: $300,000. Useful life, N: 8 years. Salvage value, S: $34,000."
Double-Declining-Balance Depreciation A building acquired at the beginning of the year at a cost of $76,400...
Double-Declining-Balance Depreciation A building acquired at the beginning of the year at a cost of $76,400 has an estimated residual value of $3,100 and an estimated useful life of four years. Determine the following. (a) The double-declining-balance rate % (b) The double-declining-balance depreciation for the first year $
A depreciable asset is purchased for $50,000. The expected salvage value is zero at the end...
A depreciable asset is purchased for $50,000. The expected salvage value is zero at the end of it’s 8 year useful life. Compute the depreciation schedule by using double declining balance (DDB) to switch over straight line depreciation. Also, determine the book value of the asset after 6 years.
A fleet of refrigerated delivery trucks is acquired on January 5, 2017, at a cost of...
A fleet of refrigerated delivery trucks is acquired on January 5, 2017, at a cost of $830,000 with an estimated useful life of eight years and an estimated salvage value of $75,000. Compute the depreciation expense for the first three years using the double-declining-balance method. (Round your answers to the nearest dollar.) Depreciation for the Period End of Period Annual Period Beginning of Period Book Value Depreciation Rate (%) Depreciation Expense Accumulated Depreciation Book Value First Year Second Year Third...
1) Depreciation computed under double−declining−balance will decrease each year because: A.the book value used in the...
1) Depreciation computed under double−declining−balance will decrease each year because: A.the book value used in the computation each year increases B.the rate used in the computation each year decreases C.the book value used in the computation each year decreases D.the rate used in the computation each year increases 2) At the end of an asset's useful life, the balance in Accumulated Depreciation will: A.be greater under units−of−production depreciation than under straight-line depreciation B. be a greater amount under straight-line depreciation...
An equipment at MNS Systems costing $600,000 was depreciated using the double declining balance (DDB) method....
An equipment at MNS Systems costing $600,000 was depreciated using the double declining balance (DDB) method. In year four, the company decided to switch to the straight-line depreciation method. Determine the depreciation charges in year 4. Assume a depreciable life of 10 years and a salvage value of $63,331.
On January 1, 2017, Atlantic Company purchased a new warehouse for $840,000 with a salvage value...
On January 1, 2017, Atlantic Company purchased a new warehouse for $840,000 with a salvage value of $40,000 and an estimated useful life of 40 years. Atlantic has chosen to use the double-declining balance method of depreciation. The journal entry to record the depreciation expense of 2018 would include: Question 19 options: A. a debit to Depreciation Expense for $42,000. B. a debit to Depreciation Expense for $39,900. C. a credit to Accumulated Depreciation for $42,000. D. a debit to...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT