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egoroff_w [7]
2 years ago
11

Juno Co. purchased a machine for $10,000 and estimates it will use the machine for three years with a $2,000 salvage value. It e

xpects to produce a total of 8,000 units as follows: 3,000 during year one; 2,500 during year two; and 2,500 during year three. Using the units-of-production depreciation method, compute the machine's first year depreciation expense.
Business
1 answer:
GalinKa [24]2 years ago
4 0

The machine's first year depreciation expense is $3000.

The units-of-production depreciation method is a depreciation method where the depreciation expense of an equipment depends on the units of a product produced in a given period.

Deprecation expense = (total units produced in year 1 / total units that the machine can produce) x (cost of the asset - salvage value)

<em><u>Deprecation expense in the first year </u></em>

(3,000 / 8,000) x ($10,000 - $2,000)

0.375 x $8,000 = $3000

A similar question was answered here: brainly.com/question/25195121?referrer=searchResults

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