Asked by
Ardella Lewis
on Oct 28, 2024
Verified
The Zorro Company purchased equipment on January 1, 2010, for $100, 000.The equipment had an estimated residual value of $10, 000, an estimated useful life of five years, and estimated lifetime output of 18, 000 units.In 2011, the company produced 4, 400 units and recorded depreciation expense of $22, 000.What depreciation method did the company use?
A) straight-line method
B) sum-of-the-years'-digits method
C) double-declining-balance method
D) units-of-output method
Units-Of-Output Method
A depreciation method where the expense amount is based on the units of production or use of the asset during the period.
Residual Value
Residual Value is the estimated value that an asset will realize upon its sale at the end of its useful life, crucial for calculating depreciation for assets.
- Appraise the depreciative value through diversified strategies including double-declining balance, straight-line, and units-of-production methods.
Verified Answer
JE
Learning Objectives
- Appraise the depreciative value through diversified strategies including double-declining balance, straight-line, and units-of-production methods.