If the double-declining balance method were used to amortize a building that has a 10-year useful life and a residual value equal to 10% of the building's original cost,what amortization rate would be used?
A)9%
B)10%
C)18%
D)20%

Question

Quizplus · Accepted Answer

The double-declining balance method uses twice the straight-line depreciation rate. For a 10-year useful life, the straight-line rate is 10% (100% / 10 years). Therefore, the double-declining rate is 20% (2 x 10%).

If the Double-Declining Balance Method Were Used to Amortize a Building