Use the following information for questions 43-44.
Jeremiah Co. purchased a machine on January 1, 2017 for $22,500. The machine had an estimated useful life of 10 years and an estimated residual value of $2,500. The company uses double-declining-balance depreciation.
-If Jeremiah Co. used the straight-line method of depreciation, what would the carrying value of the machine be at the end of 2017?
A) $20,500
B) $20,250
C) $18,250
D) $18,000

Question

Quizplus · Accepted Answer

The straight-line depreciation for the first year is calculated as (Cost - Residual Value) / Useful Life = ($22,500 - $2,500) / 10 = $2,000. The carrying value at the end of 2017 is $22,500 - $2,000 = $20,500.

Use the Following Information for Questions 43-44