A Machine with a Cost of $120,000 Has an Estimated

question 116

Multiple Choice

A machine with a cost of $120,000 has an estimated residual value of $15,000 and an estimated life of 5 years or 15,000 hours. It is to be depreciated by the units-of-output method. What is the amount of depreciation for the second full year, during which the machine was used 5,000 hours?

• A) $5,000
• B) $35,000
• C) $21,000
• D) $45,000

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Definitions:

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