Use the following information for questions
On January 1, 2015, Sundry Corp.purchased equipment for $55,000.It was expected to last 8 years, after which it will be sold for $3,000.It is expected to be used for a total of 8,000 machine hours, and was used for 900 hours during the year ended December 31, 2015.
-The depreciation expense for 2015 using the units-of-production method will be
A)$5,850.
B)$6,188.
C)$6,500.
D)$13,750.

Question

Use the following information for questions 
On January 1, 2015, Sundry Corp.purchased equipment for $55,000.It was expected to last 8 years, after which it will be sold for $3,000.It is expected to be used for a total of 8,000 machine hours, and was used for 900 hours during the year ended December 31, 2015.
-The depreciation expense for 2015 using the units-of-production method will be
A)$5,850.
B)$6,188.
C)$6,500.
D)$13,750.

Quizplus · Accepted Answer

Depreciation expense = (Cost - Residual value) * (Actual machine hours / Estimated machine hours)= ($55,000 - $3,000) * (900 / 8,000)= $52,000 * 0.1125= $5,850

Use the Following Information for Questions