Question: 5. Younger Bus Lines uses the units-of-activity method in depreciating its buses. One bus was purchased on January 1, 2010, at a cost of $168,000.Over
5. Younger Bus Lines uses the units-of-activity method in depreciating its buses. One bus was purchased on January 1, 2010, at a cost of $168,000.Over its 4-year useful life, the bus is expected to be driven 100,000 miles. Salvage value is expected to be $8,000. Instructions: (a) Compute the depreciation cost per unit. () Prepare a depreciation schedule assuming actual mileage Computation End of Year Annual Units of Depreciation Depreciation Accumulated Book Year Activity X Cost/Unit - Expense Depreciation Value was: 2010-26,000 2011-32,000 2012-25,000 2013-17,000 6. Kelm Company purchased a new machine on October 1, 2010, at a cost of $120,000. The company estimated that the machine will have a salvage value of $12,000. The machine is expected to be used for 10,000 working hours during its 5-year life. Instructions: Compute the depreciation expense under the following methods for the year indicated. (a) Straight-line for 2010. (b) Units-of-activity for 2010, assuming machine usage was 1,700 hours
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