Question

On January 1, 2018, X-it Company bought a new delivery truck for $30,000. X-it plans to use the truck for 4 years, after which it will be sold for $6,000. Depreciation Expense for 2019, the 2nd year of use, using double-declining-balance equals ______.

Answer 1

To calculate the Depreciation Expense for the 2nd year of use using the double-declining-balance method, you need to determine the depreciation rate. The formula for the double-declining-balance method is: (2 / Useful Life) * Beginning Book Value. So, the Depreciation Expense for 2019 is $15,000.

Step-by-step explanation:

To calculate the Depreciation Expense for the 2nd year of use using the double-declining-balance method, you need to determine the depreciation rate. The formula for the double-declining-balance method is: (2 / Useful Life) * Beginning Book Value. In this case, the useful life is 4 years and the beginning book value is $30,000. So, the depreciation rate is (2 / 4) = 0.5. Now, you can calculate the Depreciation Expense for 2019 by multiplying the depreciation rate by the beginning book value, which is $30,000 * 0.5 = $15,000.