Using double-declining balance depreciation, determine the amount of depreciation expense and the amount of accumulated depreciation that would appear on the December 31, 2015 financial statements.
A)$0/$12,000.
B)$4,320/$11,520.
C)$480/$12,000.
D)$2,592/$14,112.

Question

Quizplus · Accepted Answer

($17,000 + $1,000) x (2 x 20%) = $7,200 depreciation in 2013; Ending book value in 2013 = $18,000 - $7,200 = $10,800; $10,800 x (2 x 20%) = $4,320 depreciation in 2014; Ending book value in 2014 = $10,800 - $4,320 = $6,480;$6,480 - $6,000 salvage value = $480 depreciation expense in 2015 ($6,480 x 40% would depreciate the office equipment below its $6,000 salvage value); $7,200 + $4,320 + $480 = $12,000 accumulated depreciation at the end of 2015.

Using Double-Declining Balance Depreciation, Determine the Amount of Depreciation Expense