Units-of-Production Method

A machine is purchased January 1 at a cost of $72,050. It is expected to produce 143,000 units and have a salvage value of $3,410 at the end of its useful life.

Units produced are as follows:

Year 1	10,900
Year 2	8,500
Year 3	11,900
Year 4	16,500
Year 5	10,500

Required:

Prepare a schedule showing depreciation for each year and the book value at the end of each year using the units-of-production method.

Units-of-Production Method
Year	Beginning Book Value	Annual Depreciation	Ending Book Value
1	$72,050
2
3
4
5