Question

A company purchased a weaving machine for $190,000. The machine has a useful life of 8 years and a residual value of $10,000. It is estimated that the machine could produce 750,000 bolts of woven fabric over its useful life. In the first year, 105,000 bolts were produced. In the second year, production increased to 109,000 units. Using the units-of-production method, what is the amount of depreciation expense that should be recorded for the second year?

Multiple Choice

• $25,200.

• $27,613.

• $26,600.

• $26,160.

• $53,160.

Answer 1

A company purchased a wearing machine for $190000. Nie maschine has a useful life of 8 year's and refideat value of 10000. It Ys estimated that the machine could produce 750000 bolts of wooden fabric over its useful life. Po the first year losood belts were produced. In the second years production increased to 109800 units. Depreciation expenses per Bolt = 190000 -10OUD 75oooo 180000 750000 =$0.24 per bolt. Deprecation per aro year = 0.248 109000 bolts. 2 & 26160 options Dr is correct.