On March 1, 2016. Hopeful Company bought an equipment costing P1,200,000 . Hopeful's depreciation policy is to depreciated long lived assets using double declining balance method The equipment has an estimated useful life of 10 years with a minimum amount salvage value at the end of its useful life What is the carrying value of the asset as of December 31, 2018 ? Select the correct response 614,000 480, 000; 640, 000 768,000

Q: What is the accumulated depreciation as of December 31, 2017?

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A:

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A: The depreciation expense can be calculated as depreciable cost divided by the useful life.

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A: Formula: Depreciation expense(straight line method)=Cost-Salvage valueUseful life

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Depreciation Methods

The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.

Depreciation Accounting

In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.