A storage tank acquired at the beginning of the fiscal year at a cost of $61,000 has an estimated residual value of $9,000 and an estimated useful life of 20 years. Determine the following: (a) the amount of annual depreciation by the straight-line method and (b) the amount of depreciation for the first and second years computed by the double-declining-balance method.

Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter11: Depreciation, Depletion, Impairment, And Disposal
Section: Chapter Questions
Problem 5MC: A machine with a 4-year estimated useful life and an estimated 15% residual value was acquired on...
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A storage tank acquired at the beginning of the fiscal year at a cost of $61,000 has an estimated residual value of $9,000 and an estimated useful life of 20 years. Determine the following:
(a) the amount of annual depreciation by the straight-line method and
(b) the amount of depreciation for the first and second years computed by the double-declining-balance method.

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