Machinery was purchased on january 1 for $51,000. the machinery has an estimated life of 7 years and an estimated salvage value of $9,000. double-declining-balance depreciation for the second year would be (round calculations to the nearest dollar):
a. $10,929
b. $10,408
c. $10,500
d. $6,000

The second year depreciation under this method amounts to $10,282

Explanation:

The depreciation rate under the method of double declining balance is computed as:

Depreciation rate = 1/ Number of years × 2

= 1/ 7 × 2

= 0.28 or 28%

Now, will be computing the first year depreciation:

First year depreciation = Cost of Machine × Depreciation rate

= $51,000 × 28%

= $14,280

Computing the second year depreciation:

Second year depreciation = (Cost of machine -First year depreciation) × Depreciation rate

= ($51,000 - $14,280) × 28%

= $36,720 × 28%

= $10,281.6 or $10,282

cuz people aint got no money