Spangle Corporation Uses the Unit-Of-Production Method to Estimate Depreciation

question 195

Multiple Choice

Spangle Corporation uses the unit-of-production method to estimate depreciation.The company purchased a new machine for $18,000 that will produce an estimated 100,000 units over its useful life.The estimated residual value of the machine is $2,000.What is the depreciation rate per unit?

• A) $1.60
• B) $1.80
• C) $0.16
• D) $0.18

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