Accelerated Depreciation

Koffman's Warehouse purchased a forklift on January 1, 2017, for $180,000. The forklift is expected to last for five years and have a residual value of $11,000. Koffman's uses the double-declining-balance method for depreciation.

Required:

1. Calculate the depreciation expense, accumulated depreciation, and book value for each year of the forklift's life. If necessary, round any depreciation calculations to the nearest dollar.

Year	Annual Depreciation			Accumulated Depreciation			Book Value
2017	$			$			$
2018
2019
2020
2021

2. Identify and analyze the effect of the transaction for depreciation for 2017.

Activity	Operating
Accounts	Depreciation Expense Increase, Accumulated Depreciation Increase
Statement(s)	Balance Sheet and Income Statement

Feedback

Record depreciation expense by increasing the expense and accumulated depreciation accounts.

How does this entry affect the accounting equation? If a financial statement item is not affected, select "No Entry" and leave the amount box blank. If the effect on a financial statement item is negative, i.e, a decrease, be sure to enter the answer with a minus sign. Remember: if a contra account is increased, it will have the effect of decreasing the corresponding financial statement item.

Balance Sheet

Income Statement

Stockholders'

Net

Assets

=

Liabilities

+

Equity

Revenues

Expenses

=

Income

Accumulated Depreciation

Equipment Expense

Feedback