Question

Equipment was purchase on April 1, 2013 with no salvage value for $308,000. It is being depreciated over 7 years. Prepare a straight-line depreciation shcedule and a double-declining depreciation schedule.

Answer 1

Straigh Line depreciation
Year	Beginning balance B	Depreciation expenses D	Accumulated Depreciation	Ending balance B-D
1	$308,000	44000	44000	$264,000
2	$264,000	44000	88000	$220,000
3	$220,000	44000	132000	$176,000
4	$176,000	44000	176000	$132,000
5	$132,000	44000	220000	$88,000
6	$88,000	44000	264000	$44,000
7	$44,000	44000	308000	$0
SLM=308000-0/7=		44000
Double declining method
DDB rate=1/7*200%		0.286
Year	Beginning balance B	Depreciation rate R	Depreciation expenses D=B*R	Accumulated Depreciation	Ending balance B-D
1	$308,000	0.286	$88,000	88000	$220,000
2	$220,000	0.286	$62,857	$150,857	$157,143
3	$157,143	0.286	$44,898	$195,755	$112,245
4	$112,245	0.286	$32,070	$227,825	$80,175
5	$80,175	0.286	$22,907	$250,732	$57,268
6	$57,268	0.286	$16,362	$267,094	$40,906
7	$40,906	0.286	$40,906	$308,000	$0
In last year the value will be reduced to zero so whole book value will be depreciated
If any doubt please comment