A company purchased office equipment for $40,000 and estimated a salvage value of $8,000 at the end of its five-year useful life.

The constant percentage to be applied against book value each year if the double-declining-balance method is used is:

a. 20%

b. 25%

c. 40%

d. 4%

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Business

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20 September, 17:54

A company purchased office equipment for $40,000 and estimated a salvage value of $8,000 at the end of its five-year useful life.

The constant percentage to be applied against book value each year if the double-declining-balance method is used is:

a. 20%

b. 25%

c. 40%

d. 4%

+3

Answers (1)

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Kaila Crane · Answer 1

40 %

Explanation:

The double depreciation method is an accelerated depreciation on the straight-line method.

Double depreciation rate = straight-line rate x 2

in his case

Depreciation rate = (1/useful x 100) x2

= (1/5x100) x 2

=20% x2

=40 %

A company purchased office equipment for $40,000 and estimated a salvage value of $8,000 at the end of its five-year useful life.The constant percentage to be applied against book value each year if the double-declining-balance method is used is:a. 20%b. 25%c. 40%d. 4%

A company purchased office equipment for $40,000 and estimated a salvage value of $8,000 at the end of its five-year useful life.

The constant percentage to be applied against book value each year if the double-declining-balance method is used is:

a. 20%

b. 25%

c. 40%

d. 4%