# Double1 - seven-twelfths of the first full year's annual...

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Double-Declining-Balance Depreciation Beginning -of-Year Book Value Year 1 (5 mo.) 5/12 × 40% × \$90,000 = \$15,000 \$15,000 \$75,000 Year 2 40% × 75,000 = 30,000 45,000 45,000 Year 3 40% × 45,000 = 18,000 63,000 27,000 Year 4 40% × 27,000 = 10,800 73,800 16,200 Year 5 40% × 16,200 = 6,200 * 80,000 10,000 Year 6 (7 mo.) 0 80,000 10,000 Under the sum-of-the-years'-digits method, the first full year's annual depreciation expense of  \$26,667 is multiplied by five-twelfths to calculate depreciation expense for the truck's first five months  of use. During the second year, depreciation expense is calculated in two steps. The remaining
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Unformatted text preview: seven-twelfths of the first full year's annual depreciation expense of \$26,667 is added to five-twelfths of the second full year's annual depreciation expense of \$21,333. This two-step calculation continues until the truck's final year of use, at which time depreciation expense is calculated by multiplying the last full year's annual depreciation expense of \$5,333 by seven-twelfths....
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## This note was uploaded on 11/14/2011 for the course ACCT 1310 taught by Professor Staff during the Fall '10 term at Texas State.

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