Worth Manufacturing Company purchased a new production machine on July 1, 2010, for $140,000. The estimated salvage

Question:

Worth Manufacturing Company purchased a new production machine on July 1, 2010, for $140,000. The estimated is $10,000. The company uses units-of-production depreciation and estimates the machine will produce 100,000 units during its useful life. In 2010, the company manufactured 5,000 units after acquiring the machine.
Depreciation expense for 2010 will be
A. $ 0
B. $ 6,500
C. $ 7,000
D. $13,000
Salvage Value
Salvage value is the estimated book value of an asset after depreciation is complete, based on what a company expects to receive in exchange for the asset at the end of its useful life. As such, an asset’s estimated salvage value is an important...