Use the data from E7-9 to answer each of the following:
1. Using the integrated financial statement framework, indicate the effects (higher or lower) of using double-declining-balance depreciation rather than straight-line depreciation on accumulated depreciation, retained earnings, and depreciation expense at the beginning of the asset's useful life.
2. Indicate the effects (higher, lower, or no effect) of using double-declining-balance depreciation rather than straight-line depreciation on the liquidity metric free cash flow and profitability metric asset turnover at the beginning of the asset's useful life.
Data from E7-9
Sandblasting equipment acquired at a cost of $42,000 has an estimated residual value of $6,000 and an estimated useful life of 10 years. It was placed in service on October 1 of the current fiscal year, which ends on December 31, 20Y5.