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(a)

Lockard Company purchased machinery on January 1, 2014, for $191,280. The machinery is estimated to have a salvage value of $19,128 after a useful life of 8 years. Warning Don\'t show me this message again for the assignment Ok  Cancel   (a) Compute 2014 depreciation expense using the double-declining-balance method. Depreciation expense $

Solution

Depreciation rate as per straight line=(100/8)=12.5%/year

Hence depreciation rate as per double decline balance=2*Depreciation rate as per straight line*Book value at beginning of each period

=(2*12.5%*191280)

which is equal to

=$47820.