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The price of a utility vehicle purchased by Knox Industries was $21,300. Its salvage value after operating for 120,000 miles is $2.130. Based on the given annual usage, prepare a UOP depreciation schedule, then enter the annual depreciation for year 5 as your answer. Round all dollar amounts to the nearest cent. Year Mies 24.199 22.869 29.251

The price of a utility vehicle purchased by Knox Industries was $21,300. Its salvage value after operating for 120,000 miles is $2.130. Based on the given annual usage, prepare a UOP depreciation schedule, then enter the annual depreciation for year 5 as your answer. Round all dollar amounts to the nearest cent. Year Mies 24.199 22.869 29.251

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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This is business algebra please show your work so I can understand the question.  Thank you

The text provides information about calculating the Units of Production (UOP) depreciation for a utility vehicle purchased by Knox Industries. Here’s a detailed transcription suitable for an educational website: --- **UOP Depreciation Calculation:** The initial purchase price of the utility vehicle was $21,300. After 120,000 miles, the vehicle’s salvage value is estimated to be $2,130. **Objective:** Using the given annual mileage, prepare a UOP depreciation schedule. Calculate and enter the annual depreciation for year 5. **Data Table:** | Year | Miles | |------|--------| | 1 | 24,199 | | 2 | 24,629 | | 3 | 22,215 | | 4 | 23,152 | | 5 | 25,805 | **Instructions:** 1. Subtract the salvage value from the purchase price to obtain the total depreciable amount: $21,300 - $2,130 = $19,170 2. Calculate the depreciation per mile by dividing the total depreciable amount by the total estimated mileage: $19,170 / 120,000 miles 3. Multiply the depreciation per mile by the miles driven each year to find the annual depreciation. 4. Enter the annual depreciation for year 5 into the provided field. Note: All dollar amounts should be rounded to the nearest cent. --- This transcription sets the context for understanding UOP depreciation and guides users through the calculation process using the provided data.
Transcribed Image Text:The text provides information about calculating the Units of Production (UOP) depreciation for a utility vehicle purchased by Knox Industries. Here’s a detailed transcription suitable for an educational website: --- **UOP Depreciation Calculation:** The initial purchase price of the utility vehicle was $21,300. After 120,000 miles, the vehicle’s salvage value is estimated to be $2,130. **Objective:** Using the given annual mileage, prepare a UOP depreciation schedule. Calculate and enter the annual depreciation for year 5. **Data Table:** | Year | Miles | |------|--------| | 1 | 24,199 | | 2 | 24,629 | | 3 | 22,215 | | 4 | 23,152 | | 5 | 25,805 | **Instructions:** 1. Subtract the salvage value from the purchase price to obtain the total depreciable amount: $21,300 - $2,130 = $19,170 2. Calculate the depreciation per mile by dividing the total depreciable amount by the total estimated mileage: $19,170 / 120,000 miles 3. Multiply the depreciation per mile by the miles driven each year to find the annual depreciation. 4. Enter the annual depreciation for year 5 into the provided field. Note: All dollar amounts should be rounded to the nearest cent. --- This transcription sets the context for understanding UOP depreciation and guides users through the calculation process using the provided data.
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