Activity-Based Depreciation Extruded Molding Company uses special molds in producing high-quality window awnings. Each mold can be
Question:
Activity-Based Depreciation Extruded Molding Company uses special molds in producing high-quality window awnings. Each mold can be used to produce 3,000 awnings before it must be scrapped. Extruded Molding purchased a new mold for $129,000 and produced 400, 600, 900, 300, and 500 awnings, respectively, during the first five years of operation. Assuming Extruded Molding uses activitybased depreciation:
a. Compute the amount to be reported as depreciation expense for each of the five years.
b. Compute the amount to be reported as accumulated depreciation at the end of each of the five years.
c. Compute the amount reported as the book value of the mold at the end of each of the five years.
Step by Step Answer:
Financial Accounting A Decision Making Approach
ISBN: 9780471328230
2nd Edition
Authors: Thomas E. King, Valdean C. Lembke, John H. Smith