Question

University Car Wash built a deluxe car wash across the street from campus. The new machines cost $237,000 including installation. The company estimates that the equipment will have a residual value of $28,500. University Car Wash also estimates it will use the machine for six years or about 12,500 total hours. Actual use per year was as follows Hours Used 2,700 2,000 2,100 1,900 1,700 2,100 Year 4 5 6 2Prepare a depreciation schedule for six years using the double-declining-balance method. (Do not round your intermediate calculations.) UNIVERSITY CAR WASH Depreciation Schedule-Double-Declining-Balance End of year amounts Depreciation Expense Accumulated Depreciation 79.000 Year Book Value 1 $ 79,000 158,000

Answer 1

A.	Cost of machine	237,000
B.	Residual value	28,500
C.	Depriciable value (A-B)	208,500
D.	Depriciation rate per hour	16.68
E.	As per doubble declining rate	33.36

UNIVERSITY CAR WASH
Depriciation Schedule - Doubble declining balance
End of year ammounts
Year	Depriciation expense	Accumulated Derpriciation	Book Value
1	90,072.00	90,072.00	146,928.00
2	66,720.00	156,792.00	80,208.00
3	51,708.00	208,500.00	28,500.00
4	-	-	-
5	-	-	-
6	-	-	-