Equipment with a Cost of $400000 Has an Estimated Salvage

question 239

Multiple Choice

Equipment with a cost of $400000 has an estimated salvage value of $25000 and an estimated life of 4 years or 15000 hours. It is to be depreciated using the units-of-activity method. What is the amount of depreciation for the first full year during which the equipment was used 3300 hours?

• A) $100000
• B) $113800
• C) $82500
• D) $93750

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