To learn how to handle these contingencies, please see our Beginner's Guide using the above link. The book value of an asset, seen on the above chart, is the asset's original cost, less any accumulated depreciation. Any impairment (weather, fire, accident) that may befall an asset is also subtracted. In year one, the depreciation expense is twice that of the straight-line method, or 2/5 (40%) of $10,000, which equals $4,000. Understanding Double Declining Balance Depreciation For example, assume your business double declining balance method purchases a delivery vehicle for $25,000. Vehicles fall under the five-year property class according to the Internal Revenue Service (IRS). The straight-line depreciation percentage is, therefore, 20%—one-fifth of the difference between the purchase price and the salvage value of the vehicle each
View more