A concrete and rock crusher for demolition work has been purchased for $64,000, and it has an estimated SV of $12,000 at the end of its five-year life. Engineers have estimated that the following units of production (in m³ of crushed material) will be contracted over the next five years. Using the units of production depreciation method, what is the depreciation allowance in year three, and what is the BV at the end of year four? EOY m³ 15,000 2 23,000 CETT 3 34,000 The depreciation allowance in year three is $. (Round to the nearest dollar.) The BV at the end of year four is $. (Round to the nearest dollar.) 4 15,000 5 13,000

A concrete and rock crusher for demolition work has been purchased for $64,000, and it has an estimated SV of $12,000 at the end of its five-year life. Engineers have estimated that the following units of production (in m³ of crushed material) will be contracted over the next five years. Using the units of production depreciation method, what is the depreciation allowance in year three, and what is the BV at the end of year four? EOY m³ 15,000 2 23,000 CETT 3 34,000 The depreciation allowance in year three is $. (Round to the nearest dollar.) The BV at the end of year four is $. (Round to the nearest dollar.) 4 15,000 5 13,000

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Description: A concrete and rock crusher for demolition work has been purchased for $64,000, and it has an estimated SV of $12,000 at the end ofits five-year life. Engineers have estimated that the following units of production (in m³ of crushed material) will b

FINANCIAL ACCOUNTING

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Chapter1: Financial Statements And Business Decisions

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Concept explainers

Depreciation Methods

The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.

Depreciation Accounting

In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.

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Question

A concrete and rock crusher for demolition work has been purchased for $64,000, and it has an estimated SV of $12,000 at the end of
its five-year life. Engineers have estimated that the following units of production (in m³ of crushed material) will be contracted over the next
five years. Using the units of production depreciation method, what is the depreciation allowance in year three, and what is the BV at the
end of year four?
ΕΟΥ
m³
1
15,000
2
23,000
CITTS
3
34,000
The depreciation allowance in year three is $. (Round to the nearest dollar.)
The BV at the end of year four is $. (Round to the nearest dollar.)
15,000
13,000
tic
ras

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