Hellow, I need help with this problem. I\'m behind on work that needs to get tur
ID: 2597698 • Letter: H
Question
Hellow, I need help with this problem. I'm behind on work that needs to get turned in asap. I posted this problem before, but got a weird response that I could not make out. Hopefully someone can help me. Thank you very much, your time is greatly appreciated.
Depreciation by Two Methods
A Kubota tractor acquired on January 9 at a cost of $288,000 has an estimated useful life of ten years. Assuming that it will have no residual value.
a. Determine the depreciation for each of the first two years by the straight-line method.
b. Determine the depreciation for each of the first two years by the double-declining-balance method. Do not round the double-declining balance rate. If required, round your final answer to the nearest dollar.
First Year Second Year $__________ $__________Explanation / Answer
ans)
a) Depreciation for each of the first two years by the straight line method
Depreciation = Cost - Scrap value / Estimated useful life
= 288000 - 0 / 10
= 28800
Depreciation will be same for all years under straight line method
First year = 28800
Second year = 28800
b) Computation of depreciation under double declining method
Percentage of depreciation = 28800 / 288000 = 10%
Doble declining percentage = 10% X 2 = 20%
Using DDB method we will depreciate the book value each year by 20%
First year = 288000 X 20% = 57600
Second year = (288000 - 57600 ) X 20% = 46080
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