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user100 [1]
3 years ago
5

Marlow Company purchased a point of sale system on January 1 for $6,500. This system has a useful life of 5 years and a salvage

value of $950. What would be the depreciation expense for the second year of its useful life using the double-declining-balance method
Business
1 answer:
Travka [436]3 years ago
3 0

Answer:

$1,560

Explanation:

The computation of the depreciation expense for the second year of its useful life is shown below:

First depreciation rate is

= 1 ÷ 5 ×2

= 40%

Now the depreciation expense for one year is

= 40% of $6,500

= $2,600

Now the depreciation expense for the second year is

= ($6,500 - $2,600) ×40%

= $1,560

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Answer:

                                            Warbocks Corporation

Statement of retained earnings for the year ended December 31, 2017

                                                                                      Amount in $

Opening retained earnings                                           12,600

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Dividend                                                                         <u> (5,000)</u>

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