PE 10-4B Double-declining-balance depreciation

A building acquired at the beginning of the year at a cost of $820,000 has an estimated residual value of $100,000 and an estimated useful life of 50 years. Determine (a) the double-declining-balance rate and (b) the double-declining-balance depreciation for the first year.

Answer:
a. 4% = [(1/50) × 2]
b. $32,800 ($820,000 × 4%) 

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