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 km. 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 km. Taxi 10 cost $38,950 and is expected to have a residual value of $4,300. Taxi 10 is driven 90,000 km in 2016, and 135,000 km in 2017. Calculate

(a) The depreciable amount per kilo metre (use three decimals), and

(b) The depreciation expense for 2016 and 2017.

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