Question

On January 1, 2016, Friedman Company purchased a truck that cost $48,000. The truck had an expected useful life of 100,000 miles over 8 years and an $8,000 salvage value. During 2017, Friedman drove the truck 18,500 miles. The amount of depreciation expense recognized in 2017 assuming that Friedman uses the units of production method is ______

Answer 1

Answer: $7,400

Explanation:

Depreciation under unit of production =

[(Actual cost - Salvage value) / estimated productive capacity] × actual productive capacity

[($48,000 - $8,000)/100,000] × 18500= $7400