Depreciation - Practice Question on Service-hour method

 

M-Kalis acquired a plant at a cost of ₦3,000,000 and it is estimated to be in use for 5000 hours. The disposable value of the plant is expected to stand at ₦30,000

During the first 5 years of being in use, the plant recorded the following hours

Year   1        994 hours

Year   2        964 hours

Year   3        713 hours

Year   4        614 hours

Year   5        435 hours

 

Required:

Calculate the amount of depreciation charged for the first 5 years based on the hours recorded above.

Solution

Based on hours recorded, yearly depreciation will be