Week 4 -Homework 4 Required information Part 3 of 3 The following information ap

Question

Week 4 -Homework 4 Required information Part 3 of 3 The following information applies to the questions displayed belowJ Ramirez Company Installs a computerized manufacturing machine in its factory at the beginning of the year at a cost of $44,200. The machine's useful life is estimated at 10 years, or 392.000 units of product, with a $5,000 salvage value. During its second year, the machine produces 33.200 units of product. 8.33 points Determine the machine's second-year depreciation using the double-declining-balance method eBook Double-declining-balance Depreciation Annual Depreciation Expense Depreciation expense Choose Factors: choose Factor(%) Hint First year's depreciation Second year's depreciation Print References

Explanation / Answer

double declining balance rate = 100% / life in years * 2

here, life = 10 years.

=> double declining balance rate = 100% / 10 years * 2 =>20 %.

note:

second year beginning book value = $44,200 - $8840 =>$35,360.

Choose factor X choose factor (%) annual depreciation expense beginning book value X double the straight line rate = depreciation expense First year's depreciation $44,200 X 20% $8,840 second year's depreciation $35,360 X 20% $7,072

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