Respuesta :
By double-declining method;
Depreciation expense = 2*(1/life)*Book value at begging of the year
Year 1:
Book value = $23,000
Depreciation = 2*(1/5)*23000 = $9200
Year 2:
Book value = 23000-Depreciation in year 1 = 23000-9200 = $13,800
Depreciation = 2(1/5)*13800 = $,5,520
Book value at the end of year 2 = Book value at beginning - depreciation = 13800 - 5520 = $8,280
Depreciation expense = 2*(1/life)*Book value at begging of the year
Year 1:
Book value = $23,000
Depreciation = 2*(1/5)*23000 = $9200
Year 2:
Book value = 23000-Depreciation in year 1 = 23000-9200 = $13,800
Depreciation = 2(1/5)*13800 = $,5,520
Book value at the end of year 2 = Book value at beginning - depreciation = 13800 - 5520 = $8,280
The book value at the end of the second year is $8,280.
Further Explanation:
Double declining balance method: It is a depreciation method in which the rate that is used to depreciate the asset is twice the rate as it is depreciated in the straight-line method. The depreciation is calculated as:
[tex]{\text{Double Declining Balance Formula=2}}\times{\text{ }}\frac{{{\text{Cost of the asset}}}}{{{\text{Useful Life}}}}[/tex]
Calculate the depreciation under the double declining balance method:
Year 1:
[tex]\begin{aligned}\text{Book Value}&=\$23,000\\\text{Depreciation for the first year}&=2\times\dfrac{\$23,000}{5}\\&=\$9,200\\\text{Book Value at the end of year 1}&=\$23,000-\$9,200\\&=\$13,800\end{aligned}[/tex]
Year 2:
[tex]\begin{aligned}\text{Book Value}&=\$13,800\\\text{Depreciation for the first year}&=2\times\dfrac{\$13,800}{5}\\&=\$5,520\\\text{Book Value at the end of year 2}&=\$13,800-\$5,520\\&=\$8,280\end{aligned}[/tex]
Therefore, the book value at the end of the second year is $8,280.
Learn more:
⦁ Learn more about the recording of depreciation expenses
https://brainly.com/question/11220357
⦁ Learn more about the value of the machine
https://brainly.com/question/9503013
⦁ Learn more about the variable costing
https://brainly.com/question/9203162
Answer details:
Grade: High School
Subject: Accounts
Chapter: Depreciation
Keywords:Mohr company, a machine, cost of $23,000, the double-declining-balance method, the machine's useful life, five years, salvage value, the machine's book value, depreciation, type of depreciation, face value.
