A company uses the double declining balance method for a machine with a cost of \$80,000, a residual value of \$8,000, and a useful life of 4 years. How does this choice impact the net book value at the end of year 2 compared to using the straight line method?

• A. Net book value is the same for both methods.
• B. Net book value is unpredictable with double declining balance.
• C. Net book value is higher with double declining balance.
• D. Net book value is lower with double declining balance.

Answer: (D)