An equipment was purchased for $15,000.It has a useful life of 5 years and a residual value of $4,000.Determine the depreciation expense for the first year using the double-declining-balance method?
A) $5,400
B) $6,000
C) $2,200
D) $2,600

Question

Quizplus · Accepted Answer

The double-declining-balance method calculates depreciation by doubling the straight-line rate. The straight-line rate is 1/5 = 20%. Double that rate is 40%. First-year depreciation is 40% of $15,000, which is $6,000.

An Equipment Was Purchased for $15,000