1. When the expected cost to dismantle and remove an asset exceeds the expected selling price of a depreciable asset, the difference is A. added to cost to determine the depreciable base B. deducted from accumulated depreciation in the year of disposal C. not included in the calculation of depreciation expense D. added to the depreciation expense in the year of disposal

2. Depreciation of an asset based on the number of hours of usage is a(n) A. time-based method B. accelerated method C. replacement method D. activity-based method

3. Which depreciation method ignores residual value when computing the depreciable base of an asset? A. sum-of-the-years'-digits method B. double-declining-balance method C. composite method D. group method

4. The Zorro Company purchased equipment on January 1, 2010, for $100,000. The equipment had an estimated residual value of $10,000, an estimated useful life of five years, and estimated lifetime output of 18,000 units. In 2011, the company produced 4,400 units and recorded depreciation expense of $22,000. What depreciation method did the company use? A. straight-line method B. sum-of-the-years'-digits method C. double-declining-balance method D. units-of-output method