Partial-Year Depreciation Sandblasting equipment acquired at a cost of $64,000 h
ID: 2378813 • Letter: P
Question
Partial-Year Depreciation
Sandblasting equipment acquired at a cost of $64,000 has an estimated residual value of $4,000 and an estimated useful life of eight years. It was placed in service on April 1 of the current fiscal year, which ends on December 31.
a. Determine the depreciation for the current fiscal year and for the following fiscal year by straight-line method.
Depreciation
Year 1 ? $
Year 2 ? $
b. Determine the depreciation for the current fiscal year and the following fiscal year by the double-declining-balance method.
Depreciation
Year 1 ? $
Year 2 ? $
Explanation / Answer
a) .75 of an yr
SL Depr/year = (Cost - resid)/life = (64,000-4,000)/8 = 60 , 000 / 8
60000/8 *.75 = $5625 for 1 yr
b) DDB Depr for year 1 = cost / (life/2) = 64,000 / (8/2) = $16,000
$16,000 * 0.75 = $12000