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He average age of a production machine can be calculate: A) substracting the accumulated depreciation from the gross value of the machine

B) dividing the gross book value of the machine by its accumulated depreciation
C) dividing the accumulated depreciation by the depreciation expense of the machine
D) dividing the ending gross value by the depreciation expense of the machine

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The correct option for calculating the average age of a production machine is B) dividing the gross book value of the machine by its accumulated depreciation.

The formula to calculate the average age of a production machine is:

Average Age = Gross Book Value / Accumulated Depreciation

The gross book value represents the original cost or initial value of the machine. The accumulated depreciation represents the total depreciation expense recorded for the machine over its useful life.

By dividing the gross book value by the accumulated depreciation, we can determine the average age of the machine. This indicates the length of time the machine has been in use and depreciated.

Option A is incorrect because subtracting the accumulated depreciation from the gross value gives the net book value, not the average age. Option C is a mistake because dividing the accumulated depreciation by the depreciation expense does not provide information about the average age of the machine. Option D is incorrect because dividing the ending gross value by the depreciation expense does not yield the average age of the machine.

User Misha Moroshko
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