|
Cost |
$ 110,000 |
|
Salvage value |
$ 20,000 |
|
Useful life |
5 |
|
Purchase date |
January 1, 2011 |
Straight line depreciation
|
Year |
Depreciation |
|
|
2011 |
$ 18,000 |
=($110,000 - $20,000) x 1/5 |
|
2012 |
$ 18,000 |
=($110,000 - $20,000) x 1/5 |
|
2013 |
$ 18,000 |
=($110,000 - $20,000) x 1/5 |
|
2014 |
$ 18,000 |
=($110,000 - $20,000) x 1/5 |
|
2015 |
$ 18,000 |
=($110,000 - $20,000) x 1/5 |
|
Total |
$ 90,000 |
|
Double declining balance depreciation
Depreciation rate = 1/5 x 200% = 40%
|
Year |
Book value at the beginning of year |
Depreciation rate |
Depreciation expense |
|
Accumulated depreciation |
Book value at year-end |
|
2011 |
$ 110,000 |
40% |
$ 44,000 |
|
$ 44,000 |
$ 66,000 |
|
2012 |
$ 66,000 |
40% |
$ 26,400 |
|
$ 70,400 |
$ 39,600 |
|
2013 |
$ 39,600 |
40% |
$ 15,840 |
|
$ 86,240 |
$ 23,760 |
|
2014 |
$ 23,760 |
40% |
$ 3,760 |
(*1) |
$ 90,000 |
$ 20,000 |
|
2015 |
$ 20,000 |
40% |
$ - |
|
$ 90,000 |
$ 20,000 |
|
Total |
|
|
$ 90,000 |
|
|
|
(*1)
Depreciation stops when accumulated depreciation reaches depreciation
base.
Depreciation base = cost - salvage value = $110,000 - $20,000 = $90,000
150% declining balance depreciation
Depreciation rate = 1/5 x 150% = 30%
|
Year |
Book value
at the
beginning
of year |
Depreciation rate |
Depreciation expense |
|
Accumulated depreciation |
Book value at year-end |
|
2011 |
$ 110,000 |
30% |
$ 33,000 |
|
$ 33,000 |
$ 77,000 |
|
2012 |
$ 77,000 |
30% |
$ 23,100 |
|
$ 56,100 |
$ 53,900 |
|
2013 |
$ 53,900 |
30% |
$ 16,170 |
|
$ 72,270 |
$ 37,730 |
|
2014 |
$ 37,730 |
30% |
$ 11,319 |
|
$ 83,589 |
$ 26,411 |
|
2015 |
$ 26,411 |
30% |
$ 6,411 |
(*2) |
$ 90,000 |
$ 20,000 |
|
Total |
|
|
$ 90,000 |
|
|
|
(*2)
Depreciation stops when accumulated depreciation reaches depreciation
base.
Depreciation base = cost - salvage value = $110,000 - $20,000 = $90,000
Sum-of-the-years'-digits depreciation
|
Sum of the years' digits |
15 |
=1+2+3+4+5 |
|
|
Year |
Years' digits |
Depreciation |
|
|
2011 |
5 |
$ 30,000 |
=($110,000 - $20,000) x 5/15 |
|
2012 |
4 |
$ 24,000 |
=($110,000 - $20,000) x 4/15 |
|
2013 |
3 |
$ 18,000 |
=($110,000 - $20,000) x 3/15 |
|
2014 |
2 |
$ 12,000 |
=($110,000 - $20,000) x 2/15 |
|
2015 |
1 |
$ 6,000 |
=($110,000 - $20,000) x 1/15 |
|
Total |
15 |
$ 90,000 |
|
|