3.03 points On June 30. 206, Prego Equipment purchased a precision laser-guided

Question

3.03 points On June 30. 206, Prego Equipment purchased a precision laser-guided steel punch that has an expected capacity of 300,000 urits and no residual value. The cost of the depreciabed using the c ct were produced. At the begning of20rz eng neers estinated that the madre can realticaly be used to machine was $450,000 and is to be orodution method brg mrth, al 2016, 24000unes of produce only another 230,000 units. Ding 20 70000 units were produced. Prego would report depreciation in 206 of $18.000 $43.900 O $36,000 6 2

Explanation / Answer

CALCULATION OF THE DEPRECIATION AS PER UOP METHOD Purchase Cost of Equipment = $            4,50,000.00 Less: Salvage Value = $                               -   Net Value for Depreciation = $            4,50,000.00 Expected to Produce Units=                3,00,000.00 Units Depreciation per unit = $                          1.50 Per Unit Cost ($ 450,000 / 300,000 Units) CALCULATION OF THE DEPRECIATION Years Units Produced Depreciation per Unit Produced Value of the Depreciation Closing Book Value 2016                                       24,000.00 $                          1.50 $     36,000.00 $ 4,14,000.00 Answer = Depreciation for the year 2016 = Option 4 = $     36,000.00

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