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On January 1, 2002 Fulbrite Services Inc. purchased a new machine for $600,000. The machine had an estimate useful life of eight years and a salvage value of $150,000. Fulbrite elected to depreciate the machine using the double declining balance method. ON January 1, 2005, the company decided to change to straight line depreciation. Ignoring income tax considerations prepare the entries to record

Fulbrite's 2004 depreciation expense
Depreciation expense 57421.88
Accumulated Depreciation expense 57421.88

100%/8=.125 2002 600,000*.125=75000
2003 525,000*.125=65625
2004 459375*.125=57421.88 this is how I got 2004 depreciation

Change to straight line in 2005 600,000-198046.88=401953.12-150000/8 = 31494.14
Fulbrite's 2005 depreciation expense
Depreciation expense 31494.14
Accumulated Depreciation expense 31494.14


Is this correct??

[CaptainForest]

Notes: Double declining balance you would calculate at 200%
I see from your calculations that you do NOT use the half year rule, so I will not use it in my calculations.

Depreciable Amount = 600,000-150,000=450,000

Rate: 1/[8/2] = 1/4 = 25%

2002 – Dep Expense - $112,500
2003 – Dep Expense - $84,375
2004 – Dep Expense - $63,281.25

2005 a change to straight line.

Total Accumulated Depreciation in 2002-2004 = $260,156.25

Total Amount to Depreciate in 2005 under straight line: 450,000=260,156.25 = $189,843.75 / Useful Life of 5 years remaining = $37,968.75/year

2005 – Dep Expense - $37,968.75
2006, 2007, 2008, 2009 – Dep Expense - $37,968.75