If Eagle uses the double-declining balance depreciation method,the depreciation expense in 2014 is

A) $16,000.
B) $24,000.
C) $31,500.
D) $40,000.

With the double-declining balance method, the depreciation rate is twice that of the straight-line method. Therefore, the depreciation expense in the first year is:

Depreciation rate = 2 / 4 = 0.5 or 50%
Depreciation expense for 2013 = $126,000 * 50% = $63,000

For the second year, we apply the same depreciation rate to the remaining balance of the asset, which is:

Carrying value at the beginning of 2014 = $126,000 - $63,000 = $63,000
Depreciation expense for 2014 = $63,000 * 50% = $31,500

Therefore, the answer is C) $31,500.