What Is the Meaning of "Units-Of-Production Method

question 70

Multiple Choice

What is the meaning of "units-of-production method"?

• A)The systematic allocation of an asset's depreciable amount allocated in proportion to the productive capacity used.
• B)The systematic allocation of an asset's depreciable amount allocated evenly over the asset's estimated useful life.
• C)The systematic allocation of an asset's depreciable amount over its estimated useful life.
• D)The systematic allocation of an asset's depreciable amount whereby a period's depreciation equals the asset's net carrying amount multiplied by a fixed percentage.

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Definitions:

Capital Account Balances

The amount in the capital accounts of a business or an individual, representing ownership interest or invested capital.

Income Sharing

An arrangement where profits or losses are distributed among stakeholders or partners according to a predetermined formula or agreement.

Capital Credit

Credits accumulated by members of a cooperative that represent their portion of the surplus earnings distributed by the cooperative.

Equity Purchase

Involves buying shares of a company, thus acquiring ownership interest in that company.