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30 December, 20:31

1. A company entered into the following transactions concerning its computer system: On January 1, 2010 purchased a computer system that cost $280,000. The estimated useful life of the computer is 3 years and salvage value is $40,000. Calculate the first years depreciation using (1) St. Line and (2) Double Declining Balance.

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  1. 30 December, 20:58
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    First year Straight line = (280000-40000/3) = 80000

    Double decline = 100/3*2 = 2/3 = 280000*2/3 = $186667
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