Amanda, Inc., has a popular line of sunglasses. Amanda reported net income of $68 million for 20X1. Depreciation expense for the year totaled $18 million. Amanda, Inc., depreciates plant assets over 8 years using the straight-line method and no residual value.
Amanda, Inc., paid $160 million for plant assets at the beginning of 20X1. Then at the start of 20X2, Amanda switched over to double-declining-balance (DDB) depreciation. 20X2 is expected to be the same as 20X1 except for the change in depreciation method. If Amanda had been using DDB depreciation all along, how much net income can Amanda, Inc. expect to earn during 20X2? Ignore income tax.