Chapter 9 In Class Exercises: Depreciation Methods 30,000 1) Depreciable Cost = Cost - Salvage Value Scenario: Cost Useful Life (Years) = Useful Life (Hours) Salvage Value = 140,000 2,000 Depreciable Cost = 2) Calculate the Double DB rate: SL Rate - Double DB rate a) Calculate the SL annual rate: Exp b) Calculate depreciation expense, accumulated depreciation and book value for the life of the asset. Depreciable Depreciation Annual Depr Accum. Year Cost Rate Depr. Book Value 2010 2011 2012 2013 2014 = Salvage Value Depr. Cost Depr. Cost 2) Method 2: Units of Activity a) Calculate the Units of Activity rate: * > 31 1 b) Calculate depreciation expense, accumulated depreciation and book value for the life of the asset. Units of Depreciation Annual Depr Accum. EE Year Activity Rate Exp D epr. 2010 30,000 2011 20,000 2012 25,000 2013 40.000 2014 2 5,000 Salvage Value 140,000 Depr. Cost 811 3) Method 3: Double-Declining Balance SL Rate DDB Rate = a) Calculate depreciation expense, accumulated depreciation and book value for the life of the asset. Book Value Depreciation Annual Depr Accum. Depr... Book Value Year Beg. Of Year Exp 30,000 2010 2011 2012 2013 2014 - Salvage Value PLUG - Depr. Cost