Depreciation Method of Working Hours Unit Assets

The amount of depreciation using the unit method of working hours of assets is calculated based on each unit of working hours of its assets.

Formula of Depreciation Method of Working Hours Unit Assets

Information :
A = Cost of assets is the amount of costs incurred by the company to acquire an activation until the asset is ready to be operated.
S = Estimated residual value of the asset is the value of the appraisal that may be obtained through the assets that have passed its life.
SK = Book value at the end of year K
r = Depreciation rate or percentage depreciation
Q = Number of working hours
D = Depreciation expense for each period

Example Question of Depreciation Method of Working Hours Unit Assets

An asset at a cost of $ 30,000,000. It is estimated that the useful life of the assets for 7 years with the operation of the machine for 40,000 hours and has a residual value of $ 6,000,000. Please specify the depreciation of each asset's workflow!

Answer:
A = $ 30,000,000
n = 7 years
Q = 40,000 hours
S = $ 6,000,000

So the depreciation of each working hour of the assets is $ 600 per hour.

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