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sashaice [31]
3 years ago
6

A machine costing $450,000 with a four-year life and an estimated $30,000 salvage value is installed by Lux Company on January 1

. The factory estimates the machine will produce 1,050,000 units of product during its life. It actually produces the following units for the first 2 years: year 1, 260,000; year 2, 275,000. What is the depreciation amount for year 2 under the double declining balance method
Business
1 answer:
Tasya [4]3 years ago
4 0

Answer:

$112,500

Explanation:

Depreciation expense using the double declining method = Depreciation factor x cost of the asset

Depreciation factor = 2 x (1/useful life)  

Depreciation expense in year 1 = 2/4 x $450,000 = $225,000

Book value at the beginning of year 2 =  $450,000 - $225,000 =  $225,000

Depreciation expense in year 2 = 2/4 x $225,000 = $112,500

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