Question

Marlow Company purchased a point of sale system on January 1 for $3,400. This system has a useful life of 10 years and a salvage value of $400. What would be the depreciation expense for the first year of its useful life using the double-declining-balance method? Multiple Choice

$600.
$680.
$300.
$2,720.
$2,320.

Answer 1

The correct answer is B.

Step-by-step explanation:

Giving the following information:

Marlow Company purchased a point of sale system on January 1 for $3,400. This system has a useful life of 10 years and a salvage value of $400.

Annual depreciation= 2*[(book value)/estimated life (years)]

Annual depreciation= (3,400/10)*2= $680