The cost of an asset is $1,090,000, and its residual value is $300,000. Estimated useful life of the asset is eight years. Calculate depreciation for the first year using the double-declining-balance method of depreciation. (Do not round any intermediate calculations, and round your final answer to the nearest dollar.)
A) $197,500
B) $272,500
C) $136,250
D) $98,750
B) $272,500
Explanation: Double-declining-balance depreciation = (Cost - Accumulated depreciation) × 2 × (1 / Useful life)
Depreciation for the first year = $1,090,000 × 2 × (1 / 8) = $272,500
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