contestada

Kansas Enterprises purchased equipment for $80,500 on January 1, 2021. The equipment is expected to have a five-year service life, with a residual value of $8,400 at the end of five years. Using the double-declining balance method, depreciation expense for 2021 would be: (Do not round your intermediate calculations)

Respuesta :

hyderali230

Answer:

Depreciation Expense for 2021 would be $28,840

Explanation:

Double Declining balance method is the form of accelerated depreciation method, in which value of asset depreciated twice by the rate which is charged in straight line method.

Depreciable Cost = Cost of Asset - Residual value

Depreciable Cost = $80,500 - $8,400 = $72,100

Double-declining-balance rate = [ 2 x Depreciable cost  / Useful life ] / Cost of Asset

Double-declining-balance depreciation = 2 x $72,100 / 5 = $28,840