... of time used. Units of activity: Instead of expressing the life as time period, useful life is expressed in terms of the total units of production or use expected from the asset. In this method production can be measured in terms of units of output, working hours and driven miles. To use this method, the total units of activity for the entire useful life are divided into depreciable cost to determine the depreciation cost per unit. The depreciation cost applied to the units of activity to determine the annual depreciation. This method is difficult to make a reasonable estimate activity. It used by large companies because its results in the best matching of expenses with revenues. Declining balance: Produce a decreasing annual depreciation expense over the useful life of the asset it's computed by multiplying the book value at the begging of the year by declining balance depreciation rate. The depreciation rate ...

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