What would be the depreciation expense for the second year of its useful life using the double-declining-balance method?

A) $680.
B) $480.
C) $544.
D) $600.
E) $300.

Double-declining-balance method involves dividing the useful life of the asset by 2, and then multiplying that percentage with the book value at the beginning of the period.

Depreciation rate = 1/10 x 2 = 0.2 or 20%
Book value at the beginning of the period 2 = Cost - Depreciation Expense for Year 1 = $3,400 - ($3,400 x 0.2) = $2,720

Depreciation Expense for Year 2 = Book value at the beginning of the period 2 x Depreciation rate = $2,720 x 0.2 = $544.

Therefore, the correct answer is C) $544.