A Company Purchased a Weaving Machine for $190,000

question 139

Multiple Choice

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 75,000 bolts of woven fabric over its useful life. In the first year, 15,000 bolts were produced. In the second year, production increased to 19,000 units.
-Using the units-of-production method, what is the amount of accumulated depreciation at the end of the second year?

• A) $48,133.
• B) $23,750.
• C) $86,133.
• D) $45,600.
• E) $81,600.

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Definitions:

Standards

Performance goals, often relating to how much a product should cost.

Bonuses

Additional financial rewards given to employees as an incentive or reward for their performance.

Standard Costs

Predetermined costs serving as a benchmark for evaluating the actual cost performance of operations.

Measuring Efficiency

The process of evaluating the performance of a system, organization, or component by comparing its output with its input.