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Moped, Inc. purchased machinery at a cost of $44,000 on January 1, 2020. The expected useful life is 5 years and the asset is expected to have salvage value of $4,000. Moped depreciates its assets using the double-declining balance method. What is the accumulated depreciation for this asset on December 31, 2021?

Respuesta :

Tundexi

Answer:

$28,160

Explanation:

Straight line dep rate = 1/Useful life of the aset * 100

Straight line dep rate = 1/5 * 100

Straight line dep rate = 20%

Double declining balance rate = Straight line dep rate  * 2

Double declining balance rate = 20% * 2

Double declining balance rate = 40%

1st year depreciation = $44,000 * 0.40 = $17,600

2nd year depreciation = ($44,000-$17,600) * 0.40 = $10,500

Accumulated depreciation = $17,600 + $10,500 = $28,160.

So, the accumulated depreciation for this asset on December 31, 2021 is $28,160.

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