Question:
XYZ Company recently acquired a new piece of machinery for its manufacturing operations at a cost of $50,000. The machinery is expected to have a useful life of 5 years and no salvage value. XYZ uses the straight-line depreciation method for all its assets. During the first year of ownership, XYZ decides to change its depreciation method to the double declining balance method for tax purposes. Calculate the depreciation expense for both accounting and tax purposes for the first two years and the carrying amount of the machinery at the end of the second year.

Answer rating: 100% (QA)

The detailed answer for the above question is provided below Solution To calculate depreciation expe... View the full answer