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this topic is a bit challenging for me for example how do we calculate using the unit of out-put
I think that the question would have to give you more information to allow you to calculate depreciation using this method. For instance, the question might describe a piece of machinery costing $101000 and expected to be capable of outputing a million units before being scrapped by the company for a residual value of $1000. If a hundred thousand units are produced by the machine in its first year of operation then $10000 worth of depreciation is the sum that should be accounted for in the company’s accounts if deprecition is to be calculated on this basis.The following gives the calculation I used to work out the depreciation on the above example-
one hundred thousand units/one million units x (101000-1000)
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