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Tamarisk Taxi Service uses the units-of-activity method in computing depreciation on its taxicabs. Each cab is expected to be driven 160,000 miles. Taxi no. 10
Tamarisk Taxi Service uses the units-of-activity method in computing depreciation on its taxicabs. Each cab is expected to be driven 160,000 miles. Taxi no. 10 cost $35,000 and is expected to have a salvage value of $1,400. Taxi no. 10 is driven 32,500 miles in year 1 and 24,500 miles in year 2.
1. Calculate depreciation cost per mile using unit-of-activity method. (Round answer to 2 decimal places, e.g. 0.50.)
2. Compute the depreciation for each year. (Round answers to 0 decimal places, e.g. 125.)
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