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23 September, 07:51

At December 31, 20X3, before recognizing any depreciation expense for 20X3, X Company has a machine with an original cost of $360,000 and accumulated depreciation of $90,000. The machine is used to manufacture a specific product and, at December 31, 20X3, has a remaining useful life of 7 years with no salvage value. The machine was used to produce 10,000 units in the current year, 20,000 units in previous years, and is expected to be used to produce an additional 50,000 units over its remaining life. If X Company uses the units of production method for calculating depreciation, depreciation expense in 20X3 will be (rounded) :

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  1. 23 September, 09:24
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    If X Company uses the units of production method for calculating depreciation, depreciation expense in 20X3 will be (rounded):

    $45000

    Explanation:

    Cost 360000

    Accum. Depre 90000

    Usefull life 7

    Produce 1 20000

    Produce 2 10000

    Produce 3 50000

    80000

    Deprec=cost/unit

    Depre=360000/80000

    Depre = 4,5

    Produce 2012 20000 4,5 90000

    Produce 2013 10000 4,5 45000

    Produce rest 50000 4,5 225000

    80000 4,5 360000
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