Accounting 217 Q26 review

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What is the depreciation expense for the first year under the double diminishing balance method?

The answer says (800,000-100,000)*0.40

My question is: why do they minus the residual? In double diminishing, shouldn’t you just use the carrying amount at the beginning of the year?

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You are correct, the solution should not have included the residual value.

Therefore should be:

($800,000) x (1/5 years) x 200% = $320,000

Thanks for catching that and I hope my response made sense!