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Question - Units of Activity - Orange Bus Lines uses the units-of-activity method in depreciating its buses. One bus was purchased on January 1, 2014, at a cost of Rs.148,000. Over its 4-year useful life, the bus is expected to be driven 100,000 miles. Salvage value is expected to be Rs.8,000.
Required -
(a) Compute the depreciable cost per unit.
(b) Prepare a depreciation schedule assuming actual mileage was 2014, 26,000; 2015, 32,000; 2016, 25,000; and 2017, 17,000.
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