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Davis has decided that the equipment purchased 12/3/13 for $1,800 (a computer) and the office furniture purchased 12/4/13 for $4,200 are estimated to last five (5) years from January 31, 2014. The computer is determined to have a residual value of $60 and the office furniture will have a residual value of $40. NOTE: This is a change in the calculation of the depreciation so you have to determine the book value at the time of the change and recalculate the depreciation for the balance of the period.
Requirements:
1. Calculate the amount of depreciation expense for each for the month ended February 28, 2014 assuming the company uses the double-declining-balance method for the computer and the straight line method for the office furniture.
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