Ask Question
21 January, 16:00

Computer equipment was acquired at the beginning of the year at a cost of $46,250 that has an estimated residual value of $2,800 and an estimated useful life of five years. (a) Determine the depreciable cost $ (b) Determine the double-declining-balance rate % (c) Determine the double-declining-balance depreciation for the first year $

+5
Answers (1)
  1. 21 January, 16:03
    0
    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 = $46,250 - $2,800 = $43,450

    Double-declining-balance rate = [ 2 x (Cost of Asset - Residual value) / Useful life ] / Cost of Asset

    Double-declining-balance rate = [ 2 x $46250 / 5 ] / $46,250 = 40%

    Double Declining balance depreciation for the first year = $46,250 x 40% = $18,500
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “Computer equipment was acquired at the beginning of the year at a cost of $46,250 that has an estimated residual value of $2,800 and an ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers