Your company purchases a patent for $46,000 to attempt to compete in a usually restricted market. This patent does not have a salvage value at the end of its 5-year useful life. You are tasked with computing the depreciation schedule and book value for the patent using double declining balance with a switch to the straight-line method (if necessary). Question 7 Part A: Choose the correct formula for the Double-Declining Balance depreciation method. O Depreciation, = (Initial Cost - Salvage Value) / (2 N) where N = the useful life of the project O Depreciation, - (Bn-1) / N where N = the useful life of the project O Depreciation, (Initial Cost - Salvage Value) / N where N - the useful life of the project O Depreciation, = Bn-1"(2/N) where N - the useful life of the project
Your company purchases a patent for $46,000 to attempt to compete in a usually restricted market. This patent does not have a salvage value at the end of its 5-year useful life. You are tasked with computing the depreciation schedule and book value for the patent using double declining balance with a switch to the straight-line method (if necessary). Question 7 Part A: Choose the correct formula for the Double-Declining Balance depreciation method. O Depreciation, = (Initial Cost - Salvage Value) / (2 N) where N = the useful life of the project O Depreciation, - (Bn-1) / N where N = the useful life of the project O Depreciation, (Initial Cost - Salvage Value) / N where N - the useful life of the project O Depreciation, = Bn-1"(2/N) where N - the useful life of the project
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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