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Calculating Depreciation Expense for the First Two Years

Partial Depreciation for Year 1

Full Year Deprecation for Year 2

Units of Production Depreciation

Year 1 Partial Year Depreciation

Assume 1,500 Units Produced in Year 1

Depreciation Rate Units Annual

Per Each Unit X Produced = Depreciation

$ X = $

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Year 2 Full Year Depreciation

Assume 20,000 Units Produced in Year 2

Depreciation Rate Units Annual

Per Each Unit X Produced = Depreciation

$ X = $

Calculating Depreciation Expense for the First Two Years

Partial Depreciation for Year 1

Full Year Deprecation for Year 2

Double-Declining Balance Depreciation

Remember: For Double-Declining Balance Method (DDB), we make a few calculations that are different from the first two methods. Here are my recommended Steps:

First: Convert Straight-Line Useful Life in Years from a Fraction to a Percent

A machine which cost $300,000 is acquired on October 1, 2020. Its estimated

salvage value is $30,000. The Useful Life/Recovery Period for this machine is 10 years.

10 Years = 1/10 each Year = 10% each Year

Second: Double the SL Percentage

10% X 2 = 20% each Year

Third: Multiply DDB Percentage X Book Value at the

Beginning of Each Year

***Ignore Salvage Value

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