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Bookmarks Window Help Connect https i newconnect mheducation.com/flow/connect.htm tainer Itiscontext.id- contextid&custom; action-section C Reade consumer id es Web Slice Gallery Help Save& Exit Submit MC Qu. 176 Martin Company purchases a machine at... Martin Company purc value. The machine's book value at the end of year 3 is: hases a machine at the beginning of the year at a cost of $105,000. The machine is depreciated ning-balance method. The machine's usefull ife is estimated to be 4 years with a $8,750 salvage Multiple Choice $78,750. $91875 K Prev 6 of 20Next

Explanation / Answer

As per double declining method:

Cost/life=$105000/4=$26250

Rate=$26250/$105000*100=25%

And since we have to decline the asset by double declining method rate to be used will be :50%

Year.. Beg WDV

Thus machine's book value at the end of year 3 is $13125

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Year.. Beg WDV

Rate Depreciation Closing WDV Yr 1 $105000 50% $52500 $52500 Yr 2 $52500 50% $26250 $26250 Yr 3 $26250 50% $13125 $13125

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