Copy equipment was acquired at the beginning of the year at a cost of $36,600 that has an estimated residual value of $3,300 and an estimated useful life of 5 years. It is estimated that the machine will output an estimated 1,110,000 copies. This year, 252,000 copies were made. a. Determine the depreciable cost. $ 33,300 b. Determine the depreciation rate. $ per copy c. Determine the units-of-output depreciation for the year. $

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Answer:

a. $33,300

b. $0.03 per copy

c. $7,560

Explanation:

Units of Output = (Cost - Residual Value) × ( Period`s Production / Total Expected Production)

Depreciable Cost = Cost - Residual Value

                             = $36,600 - $3,300

                             = $33,300

Depreciation Rate = Depreciable cost ÷ Expected Production

                              = $33,300 ÷ 1,110,000 copies

                              = $0.03 per copy

Depreciation for the year = Depreciation Rate × Period`s Production

                                            = $0.03 × 252,000 copies

                                            = $7,560