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Unformatted text preview: Straight line: (cost- Residual value) * 1 = depreciation expense useful life Double declining: (cost- accumulated depreciation) * 2 = depreciation expense useful life Unit of production equations: (cost- Residual value) * actual production = Depreciation expense estimated total production How managers choose p. 414-415, 419(bottom), 421(bottom) Whatever one of the methods above is most system matic, usually straight line depreciation. Depends what the objective is: report higher income than straight line, less income and less taxes than double declining....
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This note was uploaded on 03/19/2008 for the course ACCT 201 taught by Professor Anothony during the Fall '07 term at Michigan State University.
- Fall '07