Required information Use the following information for the Exercises below. (Algo) [The following information applies to the questions displayed below] On April 1, Cyclone Company purchases a trencher for $320,000. The machine is expected to last five years and have a salvage value of $60,000. Exercise 10-12 (Algo) Double-declining-balance, partial-year depreciation LO C2 Compute depreciation expense at December 31 for both the first year and second year assuming the company uses the double- declining-balance method. Note: Enter all amounts as positive values. Year 1 Year 2 Annual Period Beginning of Period Book Value Depreciation for the Period Depreciation Partial Rate Year Depreciation Expense End of Period Accumulated Depreciation $ S Book Value 0$ 0$ 0 0
Required information Use the following information for the Exercises below. (Algo) [The following information applies to the questions displayed below] On April 1, Cyclone Company purchases a trencher for $320,000. The machine is expected to last five years and have a salvage value of $60,000. Exercise 10-12 (Algo) Double-declining-balance, partial-year depreciation LO C2 Compute depreciation expense at December 31 for both the first year and second year assuming the company uses the double- declining-balance method. Note: Enter all amounts as positive values. Year 1 Year 2 Annual Period Beginning of Period Book Value Depreciation for the Period Depreciation Partial Rate Year Depreciation Expense End of Period Accumulated Depreciation $ S Book Value 0$ 0$ 0 0
Financial Accounting Intro Concepts Meth/Uses
14th Edition
ISBN:9781285595047
Author:Weil
Publisher:Weil
Chapter10: Long-lived Tangible And Intangible Assets
Section: Chapter Questions
Problem 19E
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Depreciation Methods
The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.
Depreciation Accounting
In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.
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