Why Choose Us?
0% AI Guarantee
Human-written only.
24/7 Support
Anytime, anywhere.
Plagiarism Free
100% Original.
Expert Tutors
Masters & PhDs.
100% Confidential
Your privacy matters.
On-Time Delivery
Never miss a deadline.
On March 31, 2020 Rats be Gone Inc
On March 31, 2020 Rats be Gone Inc., purchased equipment for $95,000 that makes rat traps. RBG Inc. also paid $2,300 for frieght and $2,700 for installation. The equipment is expected to last 4 years and have a salvage value of $10,000. RbG Inc expects the machine to produce a total of 30,000 rat traps. 1) ** REQUIRED** Using the same facts related to the equipment purchased for RbG Inc to complete the depreciation schedule using Double Declining Balance Method. Show your work: DDB depr. Rate Beg. NBV Depr. Rate Depr. Exp Accum Depr Ending NBV Year 2020 Apr - Dec 2021 2022 2023 2024
2) Complete an exert of the Balance Sheet Presentation on 12/31/22
Expert Solution
Double Declining Balance Method:
Double Declining Balance method of depreciation is nothing but twice the amount of depreciation calculated by straight line method.
Double Declining Balance Method Formula = 2 X Cost of the asset X Depreciation rate
According to straight line method,
Cost of an asset = 95000+2700+2300
=$100000
Salvage value = $10000
Useful life = 4 years
Depreciation Rate = 1/ Useful Life * 100
= 1/4*100
= 25%
Double Declining Balance Method Formula = 2 X Cost of the asset X Depreciation rate
= 2 x 100000 x 25% x 9/12
Year 1 = $ 37500
DDB Depreciation Rate = 2x25% =50%
| Year | Beg NBV | Depr Rate | Dep Expense | Accum Dep | Ending NBV |
| 2020 Apr-Dec | 100000 | 50% | 37500 | 37500 | 62500 |
| 2021 | 62500 | 50% | 31250 | 68750 | 31250 |
| 2022 | 31250 | 50% | 15625 | 84375 | 15625 |
| 2023 | 15625 | 50% | 5625 | 90000 | 10000 |
| 2024 | 10000 | 50% | 0 | 90000 | 10000 |
Archived Solution
You have full access to this solution. To save a copy with all formatting and attachments, use the button below.
For ready-to-submit work, please order a fresh solution below.
