A company purchased equipment valued at $825,000 on January 1.The equipment has an estimated useful life of seven years or six million units.The equipment is estimated to have a salvage value of $35,000.Assuming the units of production method of depreciation,what is the annual depreciation for the second year if .5 million units were produced?

Question

Quizplus · Accepted Answer

(825,000-35,000)/6,000,000 = .13 per unit X 500,000 = $65,000

A Company Purchased Equipment Valued at $825,000 on January 1