A British Tran jet costs $55,000,000 and is expected to fly 500,000,000 miles during its life Residual value is expected to be zero because the plane was used when acquired. If the plane travels 36,000,000 miles the first year, how much depreciation should British Tran record under the units-of-production method? A. $13, 750,000 B. $6, 875,000 C. $3, 960,000 D. Cannot be determined from the data given

The correct answer is option (C).

Explanation:

According to the scenario, the computation of the given data are as follows:

Cost = $55,000,000

Expected life = 500,000,000 miles

First year use = 36,000,000 miles

So, we can calculate the depreciation by using following formula:

Depreciation = (Cost × First year use ÷ Expected life)

By putting the value, we get

Depreciation = ( $55,000,000 × 36,000,000 ÷ 500,000,000)

= $3,960,000

two years ago, when picking flowers in the mountains back of yosemite valley, i found a book. it was blotted and storm-beaten; all of its outer pages were mealy and crumbly. the paper seemed to dissolve like the snow beneath which it had been buried, however; many of the inner pages were well preserved. and although all were more or less stained and torn, whole chapters were easily readable. this is the condition of the great open book of yosemite glaciers today; its granite pages have been torn and blurred by the same storms that wasted the castaway book.

two years ago, when picking flowers in the mountains back of yosemite valley; i found a book. it was blotted and storm-beaten, all of its outer pages were mealy and crumbly. the paper seemed to dissolve like the snow beneath which it had been buried, however, many of the inner pages were well preserved. and although all were more or less stained and torn; whole chapters were easily readable. this is the condition of the great open book of yosemite glaciers today, its granite pages have been torn and blurred by the same storms that wasted the castaway book.