A machine is bought with a loan which must be paid in 20 equal half yearly installment of R6 500. The first instalment is payabl
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Answer:
$26,166
Explanation:
As for the provided information using units of production method, we have:
Total amount to be depreciated of the machine = Cost - salvage value = $76,000 - $7,600 = $68,400
Total expected working useful hours = 700,000
Depreciation per hour = $68,400/700,000 = $0.097714
Depreciation for year 1 = $0.097714 175,000 = $17,100
Depreciation for year 2 = $0.097714 171,000 = $16,709
Depreciation for year 3 = $0.097714 164,000 = $16,025
Total depreciation = $49,834
Carrying book value = $76,000 - $49,834 = $26,166