Answer:
$8,840
Step-by-step explanation:
The unit of production method can be described as a depreciation method that is used to depreciate the value of an asset based on the expected number of units the asset the asset will produce during its useful life. It can be calculated as follows:
Depreciation expense = (Equipment original cost – Salvage value) × (Unit per year ÷ Total expected units)
From the question, the units of production is expressed as the number of miles. Given this, the depreciation expense for year 2 can be calculated as follows:
Depreciation expense for Year 2 = ($33,000 – $7,000) × (34,000 ÷ 100,000)
= $26,000 × 0.34
Depreciation expense for Year 2 = $8,840
Therefore, the amount of depreciation expense to be recognized in Year 2 assuming that Friedman uses the units-of-production method is $8,840.