On July 1, 2017, Crane Company purchased factory equipment for $293000. Salvage value was estimated to...
On July 1, 2017, Crane Company purchased factory equipment for
$293000. Salvage value was estimated to be $8500. The equipment
will be depreciated over five years using the double-declining
balance method. Counting the year of acquisition as one-half year,
Crane should record depreciation expense for 2018 on this equipment
of
| $70320. |
| $93760. |
| $91200. |
| $117200. |
Homework Answers
Double Declining Depreciation = Beginning Book Value x 2 times
straight line rate
straight line rate = 1/5 x 100 = 20%
Depreciation for 2017 = $293000 x 40% x 6/12 = $58600
Depreciation for 2018 = ($293000 - 58600) x 40% = $93760
Answer is b. $93760
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