Equipment acquired at the beginning of the year at a cost of $175,000 has an estimated residual value of $12,000 and an estimated useful life of 10 years. Determine (a) the double-declining-balance rate and (b) the double-declining-balance depreciation for the first year.
Answer:
a. 20.0% [(100% ÷ 10) × 2]
b. $35,000 ($175,000 × 20.0%)