PR 10-2B. Comparing three depreciation methods Obj. 2 Show Me How Waylander Coatings Company purchased Excel waterproofing equipment on January 6 for $320,000. The equipment was expected to have a useful life of four years, or 20,000 operating hours, and a residual value of $35,000. The equipment was used for 7,200 hours during Year 1, 6,400 hours in Year 2, 4,400 hours in Year 3, and 2,000 hours in Year 4. Rate Hours Yearly Depreciation Year 1 Year 2 Year 3 Year 4 Rate 2 Double-declining-balance method: 3 Depreciable 4 Balance 5 Year 1 -6 Year 2 17 Year 3 Yearly Depreciation