Using the double-declining balance method,depreciation for 2016 and book value at December 31,2016,would be:
A)$22,500 and $22,500.
B)$22,500 and $17,500.
C)$20,000 and $25,000.
D)$20,000 and $20,000.

Question

Quizplus · Accepted Answer

The double-declining balance method results in a constant depreciation expense over the asset's useful life. The depreciation rate is twice the straight-line rate. In this case, the asset has a useful life of 5 years and a cost of $50,000. The double-declining balance rate is 40% (2 x 20%). The depreciation expense for 2016 is $20,000 ($50,000 x 40%). The book value at December 31, 2016, is $30,000 ($50,000 - $20,000).

Using the Double-Declining Balance Method,depreciation for 2016 and Book Value