Cutter Enterprises purchased equipment for $63,000 on January 1, 2016. The equipment is expected to have a five-year life and a residual value of $4,800.

Using the double-declining balance method, the book value at December 31, 2017 would be:

Multiple Choice

• $12,600.

• $23,880.

• $22,680.

• $21,780

Cutter Enterprises purchased equipment for $78,000 on January 1, 2016. The equipment is expected to have a five-year life and a residual value of $7,500.

Using the straight-line method, the book value at December 31, 2016, would be:

Multiple Choice

• $63,900.

• $56,400.

• $62,400.

• $54,900.