Boston Corp.purchased equipment with a cost of $70,000 at the beginning of 2017.The equipment has an estimated life of 25 years or 25,000 units of product.The estimated residual value is $7,500.During 2017,1,100 units of product were produced with this machinery.Determine the following:
A. Amount of total accumulated depreciation at December 31,2017 , using units-of-production deprecia

B. Book value at the end of 2017 using straight-line depreciation

C. Why would the company choose units-of-production depreciation instead of straight-line?

Question

Boston Corp.purchased equipment with a cost of $70,000 at the beginning of 2017.The equipment has an estimated life of 25 years or 25,000 units of product.The estimated residual value is $7,500.During 2017,1,100 units of product were produced with this machinery.Determine the following:
 A. Amount of total accumulated depreciation at December 31,2017 , using units-of-production deprecia

B. Book value at the end of 2017 using straight-line depreciation

C. Why would the company choose units-of-production depreciation instead of straight-line?

Quizplus · Accepted Answer

The Answer of Boston Corp.purchased equipment with a cost of $70,000 at the beginning of 2017.The equipment has an estimated life of 25 years or 25,000 units of product.The estimated residual value is $7,500.During 2017,1,100 units of product were produced with this machinery.Determine the following:
 A. Amount of total accumulated depreciation at December 31,2017 , using units-of-production deprecia

B. Book value at the end of 2017 using straight-line depreciation

C. Why would the company choose units-of-production depreciation instead of straight-line?