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Unit-Of-Production Method

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A machine cost $40,000,has a salvage value of $8,000 and is expected to have a useful life of 100,000 hours.if it is utilized for a total of 8,000 hours in year one,what is the depreciation expense based on the unit-of-production-method at the end of the year?

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Solution Summary

Solution describes the steps to determines the depreciation expense based on unit-of-production-method at the end of the year.

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Total depreciable cost= Actual Cost-Salvage Value=40000-8000=$32,000
Total projected usage=100,000 ...

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  • BEng (Hons) , Birla Institute of Technology and Science, India
  • MSc (Hons) , Birla Institute of Technology and Science, India
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