The double-declining-balance method is a type of accelerated depreciation where the depreciation rate is double the rate of the straight-line method. Here's how to calculate the depreciation for the first year step by step.

Step 1: Determine the straight-line depreciation rate

The straight-line depreciation rate is calculated by dividing 100% by the asset's useful life.

$\text{Straight-line depreciation rate} = \frac{100\%}{5} = 20\%$

Step 2: Double the straight-line rate

Since we're using the double-declining method, we double the 20% rate:

$\text{Double-declining rate} = 20\% \times 2 = 40\%$

Step 3: Apply the double-declining rate to the book value of the asset

The book value at the beginning is the cost of the asset, which is $1,170,000.

$\text{Depreciation for the first year} = 40\% \times 1,170,000 = 468,000$

Thus, the depreciation for the first year is $468,000.

Would you like to see further details on this or have any questions?

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Here are five related questions that might expand your understanding:

1. How is the second year's depreciation calculated using the double-declining balance method?
2. What would be the depreciation in the third year?
3. How does the residual value affect depreciation in future years?
4. Can the double-declining-balance method result in a book value less than the residual value?
5. How does the double-declining-balance method compare to the straight-line method?

Tip: The double-declining balance method accelerates depreciation early on but will slow down as the book value decreases each year.