P7-2
Compare three depreciation
methods
Obj 2
SPREADSHEET
?a. 2009: straight-line
depreciation, $86,000
Newbirth Coatings Company purchased waterproofing equipment on January 2,
2009, for $380,000. The equipment was expected to have a useful life of four
years, and a residual value of $36,000.
Instructions
Determine the amount of depreciation expense for the years ended December
31, 2009, 2010, 2011, and 2012, by (a) the straight-line method and (b) the
double-declining-balance method. Also determine the total depreciation ex-
pense for the four years by each method. The following columnar headings
are suggested for recording the depreciation expense amounts:
Depreciation Expense
Year
Straight-Line
Method
Double-Declining-Balance
Method