Computer equipment was acquired at the beginning of the year at a cost of $30,625 hat has an estimated residual value of $1,800 and an estimated useful life of five years. (a) Determine the depreciable cost $____ (b) Determine the double-declining-balance rate ____% (c) Determine the double-declining-balance depreciation for the first year $______
Depreciation Methods
The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.
Depreciation Accounting
In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.
Computer equipment was acquired at the beginning of the year at a cost of $30,625 hat has an estimated residual value of $1,800 and an estimated useful life of five years.
(a) Determine the
$____
(b) Determine the double-declining-balance rate
____%
(c) Determine the double-declining-balance depreciation for the first year
$______
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