904 Problem Double Declining Balance 200% Truck Acquisition Cost $13,000 Salvage Value $1,000 (do not depreciate below SV) Useful life 5 years or 100,000 miles Placed in Service 1/1/Yr1 Depreciable Cost = Capitalized Cost MODELC: Placed in Service: 1/1/4+1 (CC) Depreciable Depr cost basis rate 40% 13,000 7,800 40% 4,680 40% 2,808 40% 1,685 40% SL year 1 2 3 4 5 MODELO: SL year 1 2 3 4 Depreciation Double Decline Model 5 6 (CC) Depreciable Depr cost basis rate 13,000 30%(1) 9,100 40% 5,460 40% 3,276 40% 1,966 40% 1,180 10 % (2) Depr expense If placed in service 4/1/Yr1(other than 1/1/Yr.1 requires proration) Accum. depr 5,200 5,200 3,120 8,320 1,872 10,192 1,123 11,315 685* 12,000 1,000=SV Fudge (cannot depreciate below SV) Depr expense *(Yr. 5 Remaining Book Value - SV) ($1,685 - $1,000 = $685) Remaining book value Accum. depr 3,900 7,540 9,724 7,800 4,680 2,808 1,685 (1) 40% x 9/12 = 30% (2) 40% x 3/12 = 10% Remaining book value 9,100 5,460 3,276 1,966 1,180 Capitlaized Cost (Book Value): START: $13,000 3,900 3,640 2,184 1,310 11,034 786 11,820 12,000 1,000=SV 180 Fudge (cannot depreciate below SV) *(Yr. 6 Remaining Book Value - SV) ($1,180 - $1,000 = $180) Capitlaized Cost (Book Value): START: $13,000 (9 month sin first year) (3 months in year six to complete 12 months)

Depreciation 9.04 Double Decline Model \begin{tabular}{|c|c|c|c|c|c|c|c|c|} \hline \multirow[t]{6}{*}{ Problem } & \multicolumn{3}{|c|}{ Double Declining Aalance 200%} & & & & & \\ \hline & \multicolumn{3}{|c|}{ Truck Acquisition Cost $13,000} & & & & & \\ \hline & \multicolumn{5}{|c|}{ Salvage Value 51,000 (do not depreciate below 5V ) } & & & \\ \hline & \multicolumn{3}{|c|}{ Useful life 5 years or 100,000 miles } & & & & & \\ \hline & \multicolumn{2}{|c|}{ Placed in Service 1/1//r1} & & & & & & \\ \hline & \multicolumn{3}{|c|}{ Depreciable Cost = Capitalized Cost } & & & & & \\ \hline \multicolumn{9}{|c|}{ MOPELC: } \\ \hline \multirow[t]{2}{*}{ Phacedin } & Service: & 1/1/y+1 & & & - & & & \\ \hline & (CC) & & & & & \multicolumn{3}{|c|}{ Capitlaized Cost (Book Value): } \\ \hline SL & Depreciable & Depr & Depr & Accum. & Remaining & START: & $13,000 & \\ \hline year & cost basis & rate & expense & depr & bookvalue & & & \\ \hline 1 & 13,000 & 40% & 5,200 & 5,200 & 7,800 & & & \\ \hline 2 & 7,800 & 40% & 3,120 & 8,320 & 4,680 & & & \\ \hline 3 & 4,680 & 40% & 1.872 & 10,192 & 2,808 & & & \\ \hline 4 & 2,808 & 40% & 1,123 & 11.315 & 1,685 & & & \\ \hline \multirow[t]{5}{*}{5} & 1,685 & 40% & 685 & 12,000 & 1,000 & =5V & & \\ \hline & & & Fudgen & \multicolumn{3}{|c|}{ (cannot depreciate below SV) } & & \\ \hline & & & & & & & & \\ \hline & & & \multicolumn{3}{|c|}{ *(Yr. 5 Remaining Book Value - SV) } & & & \\ \hline & & & \multicolumn{3}{|c|}{($1,68551,000=$685)} & & & \\ \hline \multirow[t]{2}{*}{ MONEL } & \multirow{2}{*}{\multicolumn{2}{|c|}{ service 4/1/rr1 (other than }} & & & B= & & & \\ \hline & & & & & & & & \\ \hline \multicolumn{6}{|c|}{ If placed in service 4/1/Nr1 (other than 1/1/Mr.1 requires protation) } & & & \\ \hline \multirow{2}{*}{} & & & & & & & & \\ \hline & (CC) & & + & & & \multicolumn{3}{|c|}{ Capttaized Cost (80ok Value): } \\ \hline St: & Pepreciable & Depr & Depr & Accum. & Remaining & START: & $13,000 & \\ \hline year & cost basis & rate & expense & depr & Dookivalue & & & \\ \hline 1 & 13,000 & 30%(1) & 3,900 & 3,900 & 9,100 & & & \\ \hline 2 & 9.100 & 40% & 3,640 & 7,540 & 5.460 & & & \\ \hline 3 & 5,460 & 40% & 2,184 & 9,724 & 3,276 & & & \\ \hline 4 & 3,276 & 40% & 1,310 & 11,034 & 1,966 & & & \\ \hline 5 & 1,966 & 40% & 786 & 11,820 & 1,180 & & & \\ \hline \multirow[t]{15}{*}{6} & 1,180 & 10%(2) & 180 & 12,000 & 1,000 & =5V & & \\ \hline & & +2 & Fudgen & \multicolumn{3}{|c|}{ (cannot depreciate below SV) } & & \\ \hline & & & & & & & & \\ \hline & & & *irr.6 Rem & aining Book & V Value - 5V ) & & & \\ \hline & & & 151,180$1 & 1.000=$180 & & & & \\ \hline & & & & & & & & \\ \hline & & & & & & & & \\ \hline & & (1) & 40169/12 & =30% & 19 month sin fir: & st year) & & \\ \hline & & (2) & 40963/12 & =10% & 13 months in ve & ear six to ce & mplete 12m & onths) \\ \hline & & & & & & & & \\ \hline & & & & & & & & \\ \hline & & F1 & & & = & & & \\ \hline & & & & & & & & \\ \hline & & & & & & & & \\ \hline & & & & & & & & \\ \hline \end{tabular}