b) What is the annual depreciation using the Double Dedining Method? 1/5=20% Double the rate to 40% Useful life: 5 years Net Book Net Book Value Rate Value Year 1 40% = $40,000 x 7x 7 Year 2 Accumulated Depreciation $ 16,000 25,600 7 2 Depreciation Expense $16,000 9,600 ? 2 NOT 2,073.50 2 40% Year 3 40% 14,400 8,640 7 Year 4 2 x 40% Year 5 ? Plug in 36,500 3,500 C) What is the annual depreciation using the Units of Production (Activity) Method? Assume the kilometers driven in year 1 to year 5 are as follows: Year 1: 15,000 kilometers Year 2: 25,000 kilometers Year 3: 12,000 kilometers Year 4: 27,000 kilometers Year 5: 21,000 kilometers Total: 100,000 kilometers Total usage: 100,000 km Depreciation expense: =$0.365 per km Kilometers Rate Depreciation Accumulated Net Book Value Net Book Value Expense Depreciation Year 1 40,000 Year 2 Year 3 15,000 x 25,000 X 12,000 X 27,000 21,000 Year 4 Year 5