Question: Speedy Taxi Service uses the units-of-production method in calculating depreciation on its taxicabs. Each cab is expected to be driven 550,000 kilometres. Taxi 10 cost

Speedy Taxi Service uses the units-of-production method in calculating depreciation on its taxicabs. Each cab is expected to be driven 550,000 kilometres. Taxi 10 cost $38,950 and is expected to have a residual value of $4,300. Taxi 10 is driven 90,000 kilometres in 2013, and 135,000 kilometres in 2014. Calculate

(a) The depreciable cost per kilometre (use three decimals),

(b) The depreciation expense for 2013 and 2014.

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