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During the current year, Central Auto Rentals purchased 6 0 new automobiles at a cost of $ 1 4 , 0 0 0 per car.
During the current year, Central Auto Rentals purchased new automobiles at a cost of $ per car. The cars will be sold to a wholesaler at an estimated $ each as soon as they have been driven miles. Central Auto Rentals computes depreciation expense on its automobiles by the unitsofoutput method, based on mileage.
a Compute the amount of depreciation to be recognized for each mile that a rental automobile is driven.
b Assuming that the rental cars are driven a total of miles during the current year, compute the total amount of depreciation expense that Central Auto Rentals will recognize on this fleet of cars for the year.
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