Units-of-Production Depreciation

Definition

A depreciation method based on actual usage (miles, hours, units produced) rather than time. Formula: (Cost − Salvage Value) ÷ Total Estimated Units × Units This Period.

Related Terms

Depreciation Methods

Straight-Line: Same expense every year. Declining Balance: Higher expense early, lower later. Units-of-Production: Based on actual usage (miles driven, units produced).

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