The units-of-production method of recognising depreciation is only suitable for use by entities involved in manufacturing.

Question

Quizplus · Accepted Answer

The units-of-production method of recognising depreciation can be used by entities in industries such as manufacturing, mining, and agriculture, where the usefulness of the asset is measured by its output or productivity, rather than time. It may not be suitable for entities with assets whose usefulness is measured by time, such as buildings and vehicles.

The Units-Of-Production Method of Recognising Depreciation Is Only Suitable for Use