A machine is purchased on January 1,2018,for $90,000.It is expected to have a useful life of five years and a residual value of $5,000.The company closes its books on December 31.Under the double-declining balance method,what is the total amount of depreciation to be expensed during the 2019 fiscal year (year 2 of 5)?
A)$21,600
B)$22,000
C)$22,400
D)$34,000

Question

Quizplus · Accepted Answer

DDB depreciation rate = 2/5 = 40%.Dep.Exp.per year = (cost - accumulated dep.)* (2/useful life)Year 1: ($90,000 - 0)* (2/5)= $36,000 Year 2: ($90,000 - $36,000)* (2/5)= 21,600.

A Machine Is Purchased on January 1,2018,for $90,000