Units-of-activity is an appropriate depreciation method to use when

Question

Quizplus · Accepted Answer

Units-of-activity depreciation method is appropriate when the productivity of the asset varies significantly from one period to another. This method is also appropriate when an asset's usage is not uniform throughout its useful life. Therefore, option C is the correct answer. Option A is incorrect because the productivity of the asset is required to use this method. Option B is incorrect because, in this method, the asset's usage is not constant. Finally, option D is irrelevant as being a manufacturing company has nothing to do with the method of depreciation used.

Units-Of-Activity Is an Appropriate Depreciation Method to Use When