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File Edit View History Bookmarks Window Help canvas.highline.edu 4 pts D Question 13 Joe purchased a piece of machinery for 150,000 on 1/1/2013. Joe\'s year end is December. The residual value was 25,000 and had a 10-year life or 40000 hours. Joe used the machine for Year 1 12000 hours Year 2 15000 hours What is accumulated depreciation in year 2 using the double declining balance method 54000 30000 45000 D Question 14 2 pts Eastern Star purchased the entire business of South Park for $1850,000. 12

Solution

Accumalated depreciation in year 2 = 54000

Year

Book Value Beginning

Double Declining Depreciation = 2 x Straight Line Depreciation Rate x Book Value beginning

Net Book Value End= Book value at beginning - depreciation

1

150000

= 2*10%*150000

30000

120000

2

120000

=2*10%*120000

24000

96000

54000

Straight Line Depreciation rate = 1/10 = 0.1 or 10%

Year	Book Value Beginning		Double Declining Depreciation = 2 x Straight Line Depreciation Rate x Book Value beginning	Net Book Value End= Book value at beginning - depreciation
1	150000	= 2*10%*150000	30000	120000
2	120000	=2*10%*120000	24000	96000
			54000