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Central Supply purchased a new printer for $70,000 in January of 2017. It has a fiscal...

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Finance

Central Supply purchased a new printer for $70,000 in January of2017. It has a fiscal yearend of December 31. The printer isexpected to operate for nine years, after which it will be sold forsalvage value (estimated to be $6,550).

a.      (i) How much is thedepreciation expense for the year end December 2017 and for yearendDecember 2018 if the company uses thedouble-declining-balance method?

(ii) What does the disclosure look like for the Balance Sheet asit relates to the printer for the year end December 2017 and foryearend December 2018 (using the double-declining balancemethod)?

b.      (i) How much is thedepreciation expense for the year end December 2018 if the companyuses the straight-line method?

(ii) What is the amount to be disclosed on the Balance Sheet asthe value for the printer for the year end December 2018 (using thestraight-line method)?

Answer & Explanation Solved by verified expert
3.7 Ratings (291 Votes)
Printer value 70000 Salvage value6550 Depreciation amountinitial purchase value salvage value70000655063450 Useful life9 years Answer a i Straight line depreciation rate10091111 Hence double declining    See Answer
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