Question

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In early January 2017, NewTech purchases computer equipment for $260,000 to use in operating activities for the next four years. It estimates the equipment’s salvage value at $28,000.

Prepare a table showing depreciation and book value for each of the four years assuming straight-line depreciation.

Straight-Line Depreciation Choose Numerator: / Choose Denominator: = Annual Depreciation Expense Cost minus salvageselected answer correct / Estimated useful life (years)selected answer correct = Depreciation expense not attempted / not attempted = 0 Year Annual Depreciation Year-End Book Value 2017 $58,000selected answer correct $202,000selected answer correct 2018 58,000selected answer correct 144,000selected answer correct 2019 58,000selected answer correct 86,000selected answer correct 2020 58,000selected answer correct 28,000selected answer correct Total $232,000

Need help filling this out correctly it says it wasn't fully correct

Prepare a table showing depreciation and book value for each of the four years assuming double-declining-balance depreciation. (Enter all amounts positive values.)
  

Depreciation for the Period End of Period Year Beginning-Year Book Value Depreciation Rate Annual Depreciation Accumulated Depreciation Year-End Book Value 2017 $260,000selected answer correct 50%selected answer correct $130,000selected answer correct not attempted $130,000selected answer correct 2018 130,000selected answer correct 50%selected answer correct 65,000selected answer correct not attempted 65,000selected answer correct 2019 65,000selected answer correct 50% not attempted not attempted not attempted 2020 50% not attempted not attempted not attempted Total $195,000

--Also really need help finishing this chart, thank you!

Answer 1

Table showing depreciation and book value for each of the four years assuming straight-line depreciation.

	Straight-Line Depreciation Choose Numerator: / Choose Denominator: = Annual Depreciation Expense Cost minus salvage / Estimated useful life (years) = Depreciation expense 260,000 - 28,000 / 4 = $58,000 Year Annual Depreciation Year-End Book Value 2017 $58,000 $202,000 2018 58,000 144,000 2019 58,000 86,000 2020 58,000 28,000 Total $232,000

Table showing depreciation and book value for each of the four years assuming double-declining-balance depreciation
  

	Depreciation for the Period End of Period Year Beginning-Year Book Value Depreciation Rate Annual Depreciation Accumulated Depreciation Year-End Book Value 2017 $260,000 50% $130,000 $130,000 $130,000 2018 130,000 50% $65,000 $195,000 $65,000 2019 65,000 50% $32,500 $227,500 $32,500 2020 32,500 50% $4,500 $232,000 $28,000 Total $232,000

In the 4th year, depreciation would not be calculated at 50%. Since an asset cannot be depreciated below its salvage value, hence in the 4th year, depreciation would be calculated as the difference between 4th year beginning book value and salvage value i.e. $32,500 - 28,000 = $4,500