Question
In: Accounting
Computer equipment was acquired at the beginning of the year at a cost of $27,500 that...
Computer equipment was acquired at the beginning of the year at a cost of $27,500 that has an estimated residual value of $1,700 and an estimated useful life of 5 years.
a. Determine the depreciable cost.
$
b. Determine the double-declining-balance rate.
%
c. Determine the double-declining-balance depreciation for the
first year.
$
Solutions
Expert Solution
Answer:
(a) Depreciable cost
Depreciable cost = Cost of the Asset - Estimated residual value
= $27,500 - $1,700
= $25,800
(b) Double-declining-balance rate
Double-declining-balance rate = 2 * (1 / Useful life) * 100
= 2 * (1 / 5) * 100
= 40%
(c) Double-declining-balance depreciation for the first year
Double-declining-balance depreciation for the first year = Cost of the asset * Double-declining-balance rate
= $27,500 * 40%
= $11,000
ekkarill92 answered 1 year agoRelated Solutions
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