Ch8. Video 11 - Declining-Balance Method example

The video tutorial explains the double declining balance method of depreciation, a variation of the declining balance method. It outlines the steps to calculate depreciation, emphasizing the importance of understanding the straight line rate and its multiplication by a factor of two. The tutorial provides a detailed walkthrough of calculating depreciation for each year, highlighting the significance of the book value and accumulated depreciation. It also discusses the concept of depreciable base and necessary adjustments to ensure the depreciation does not exceed the allowable amount. The tutorial concludes with final notes on the method's application.

What happens to the depreciation expense in year three, and why?

What is the final depreciation expense for year three, and how was it determined?

Why is it important to calculate the depreciable base in the double declining method?