Question

Danube recently acquired a delivery van for $22,300 paying cash. Danube projects a 4 year useful service life and a remaining residual value on the delivery van of $2,200. Danube expects to drive the van 108,000 miles during the useful service life. Please compute the annual depreciation for the 4 year life of the delivery van for the double-declining method

End of Year Amounts
Year	Depreciation Expense	Accumulated Depreciation	Book Value
1
2
3
4

Answer 1

End of years Amount
Year	Depreciation Expenses	Accumulated Depreciation	Book value
1	11150	11150	11150
2	5575	16725	5575
3	2787.5	19512.5	2787.5
4	587.5	20100	2200
Total	20100
Working Notes:
Beginning book value	22300
salvage value	2200
net value	20100
useful life (years)	4
Regular Depreciation rate	25%
depreciation rate =	1/useful life*100
=	1/4*100
=	25	%
Double - declining balance formula = 2*cost of the asset *depreciation rate
Here ,it will be 2*25% =	0.5
=	50%
	year 1	year 2	year 3	year 4
Beginning book value	22300	11150	5575	2787.5
Depreciation expenses	11150	5575	2787.5	587.5
Ending book value	11150	5575	2787.5	2200