Answer:
a- $4,000.
Explanation:
Double Declining Method
The Accelerated depreciation is charged in this method. The depreciation charged in this method is double of the charged in straight-line depreciation method.
Wecan calculate the depreciation as follow
First, calculate the Double declining rate as follow
Depreciation rate = 2 x (1/useful life) x100 = 2 x (1/4 years) x100 = 50%
Now, Charge this rate to the book value of the asset.
Year 1
Depreciation = Book value x Depreciation rate = $48,000 x 50% = $24,000
Year 2
Book value at start of Year = $48,000 - $24,000 = $24,000
Depreciation = Book value x Depreciation rate = $24,000 x 50% = $12,000
Year 3
Book value at start of Year = $24,000 - $12,000 = $12,000
The Depreciation can be charged upto the salvage value.
Depreciation = Book value - Salvage Value = $24,000 - 8,000 = $4,000
