Which of the following depreciation methods allocates more depreciation in the early years of an assets life
Question:
Which of the following depreciation methods allocates more depreciation in the early years of an asset’s life and less depreciation in later years:
a. units-of-production method
b. double-declining-balance method
c. straight-line method
d. None of the above.
Step by Step Answer:
b Doub...View the full answer
Fundamental Accounting Principles Volume I
ISBN: 978-1260305821
16th Canadian edition
Authors: Kermit Larson, Tilly Jensen, Heidi Dieckmann
Related Video
In accounting terms, depreciation is defined as the reduction of the recorded cost of a fixed asset in a systematic manner until the value of the asset becomes zero or negligible. An example of fixed assets are buildings, furniture, office equipment, machinery, etc. The land is the only exception that cannot be depreciated as the value of land appreciates with time. Depreciation allows a portion of the cost of a fixed asset to be the revenue generated by the fixed asset. This is mandatory under the matching principle as revenues are recorded with their associated expenses in the accounting period when the asset is in use. This helps in getting a complete picture of the revenue
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