computg units-of-service depreciation using the following assumptions: cost to b

ID: 405098 • Letter: C

Question

computg units-of-service depreciation using the following assumptions:

cost to be depreciated = $50,000

Salvage value = zero

Total units of service = 10,000

Units of service per year: year 1 = 2,200; year 2 = 2,100

year 3 = 2,300; year 4 = 2,200; year 5 = 200

2. using the same fromat compute units-of-service depreciation using adjusted assumptions as follows:

Cost to be depreciated = $50,000

Salvage value =$5,500

Total units of srevice = 10,000

Units of service per year: year 1 = 2,200; year 2 = 2.100 year 3= 2,300; year 4 = 2,200; year 5 = 200

Hi,

Please find the answer as follows:

Part 1:

Value to be Depreciated = 50000

Year 1 = 50000*2200/10000 = 11000

Year 2 = 50000*2100/10000 = 10500

Year 3 = 50000*2300/10000 = 11500

Year 4 = 50000*2200/10000 = 11000

Year 5 = 50000*200/10000 = 1000

Part 2:

Value to be Depreciated = 50000 - 5500 = 44500

Year 1 = 44500*2200/10000 = 9790

Year 2 = 44500*2100/10000 = 9345

Year 3 = 44500*2300/10000 = 10235

Year 4 = 44500*2200/10000 = 9790

Year 5 = 44500*200/10000 = 890

Thanks.

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