Mott Company Uses the Units-Of-Activity Method in Computing Depreciation

question 231

Multiple Choice

Mott Company uses the units-of-activity method in computing depreciation. A new plant asset is purchased for $48000 that will produce an estimated 100000 units over its useful life. Estimated salvage value at the end of its useful life is $4000. What is the depreciation cost per unit?

• A) $4.40
• B) $4.80
• C) $.44
• D) $.48

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Definitions:

SWOT Analysis

A strategic planning tool used to identify and assess strengths, weaknesses, opportunities, and threats related to business competition or project planning.

Strategic Planning

The procedure of defining a business's direction and making decisions on allocating its resources to pursue this direction.

Convert Weaknesses

Convert Weaknesses is a strategic approach aimed at identifying and transforming limitations or disadvantages of a business into strengths or competitive advantages.

Key Threats

Primary external challenges or obstacles that could negatively impact an organization's ability to achieve its strategic objectives.