Sunland Taxi Service uses the units-of-activity method in computing depreciation on its taxicabs. Each cab is expected to be driven 148,000 miles. Taxi no. 10 cost $38,000 and is expected to have a salvage value of $1,000. Taxi no. 10 is driven 28,500 miles in year 1 and 21,500 miles in year 2.

a. Calculate depreciation cost per mile using unit-of-activity method. (Round answer to 2 decimal places, e. g. 0.50.)

Depreciation cost: $ per mile

b. Compute the depreciation for each year. (Round answers to 0 decimal places, e. g. 125.)

Depreciation:

Year 1: $

Year 2: $

a. $0.25

b. Year 1 = $7,125 Year 2 = $5,375

Explanation:

Depreciation Charge using  units of activity method :

Depreciation Charge = (Cost - Salvage Value) × (period`s activity/total expected activity)

Depreciation cost per mile = (Cost - Salvage Value) / total expected activity

                                             = ($38,000-$1,000) /148,000

                                             = $0.25

YEAR 1

Depreciation  = ($38,000-$1,000) × (28,500/148,000)

                       = $7,125

YEAR 2

Depreciation  = ($38,000-$1,000) × (21,500/148,000)

                       = $5,375

whole quiz

1. the sum of all activities involved in getting high-quality products into the marketplace

2.operations

3. the principle of looking at the supply chain as a whole in order to improve the overall flow through the system.

4. produced; performed

5. activities producing tangible products, such as radios, newspapers, buses, and textbooks.

6. activities producing intangible and tangible products, such as entertainment, transportation, and education.

7.   customer focus

8. analyzing a competitor's products to identify desirable improvements

9. the systematic direction and control of the processes that transform resources into finished projects that create value for and provide benefits to consumers.

10. operation management.

your welcome leave a rate and a < 3