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Use the double-declining-balance method of depreciation. Round to the nearest dollar. Beta Graphics buys some CAD-CAM...

Use the double-declining-balance method of depreciation. Round to the nearest dollar. Beta Graphics buys some CAD-CAM computer equipment at a cost of $12,150 and estimates the life at 10 years with a scrap value of $1215. What is its book value at the end of the fourth year?

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Answer #1

Calculation of rate of depreciation under double declining method -

Depreciation rate under straight line method = 100%/uselful life of assets

= 100%/10

= 10%

Depreciation rate under double declining method = 2*Depreciation rate under straight line method

= 2*10%

= 20%

Calculation of the book value of equipment at the end of 4th year -

Please check with your answer and let me know.

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