On January 1, a Machine with a Useful Life of Five

question 164

Multiple Choice

On January 1, a machine with a useful life of five years and a residual value of $80,000 was purchased for $240,000.What is the depreciation expense for year 2 under the double-declining-balance method of depreciation?

• A)$57,600.
• B)$96,000.
• C)$76,800.
• D)$46,080.

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Definitions:

Dividend Yield

A financial ratio that shows how much a company pays out in dividends each year relative to its stock price.

Common Stock

Certificates issued by a corporation to investors as proof of their ownership rights; an account representing the ownership rights of investors in a corporation; a class of stock issued by a corporation that bears no preference rights.

Market Price

The amount at which an asset or service could be bought or sold in a current transaction between willing parties.

Management's Discussion

A section of a company’s annual report where management presents an analysis of the company’s performance, future prospects, and financial health.