Boscan Corporation purchased machinery on January 1, 2014, at a cost of $288,000

Question

Boscan Corporation purchased machinery on January 1, 2014, at a cost of $288,000. The estimated useful life of the machinery is 4 years, with an estimated salvage value at the end of that period of $26,300. The company is considering different depreciation methods that could be used for financial reporting purposes. Collapse question part (a) Partially correct answer. Your answer is partially correct. Try again. Prepare separate depreciation schedules for the machinery using the straight-line method, and the declining-balance method using double the straight-line rate. (Round answers to 0 decimal places, e.g. 125.)

Depreciation expense for 2017 under Double declining-balance is adjusted so that ending book value is equal to salvage value.

Explanation / Answer

Answer: Calculation of the Depreciation expense :

the declining-balance method using double the straight-line rate:

Straight Line depreciation schedule Year Depreciable cost Depreciation expense Accumulated dep Book value 1 261700 65425 65425 196275 2 261700 65425 130850 130850 3 261700 65425 196275 65425 4 261700 65425 261700 0

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