Which of the following depreciation methods would result in the most depreciation in the first year,...
Which of the following depreciation methods would result in the most depreciation in the first year, assuming an eight year life and no salvage value?
| A. |
Not enough information available to determine answer |
|
| B. |
The depreciation would be the same under both methods |
|
| C. |
Double-declining balance |
|
| D. |
Straight line |
Homework Answers
answer is
C. Double declining balance method
Straight line method charges equal depreciation over the life of the asset
While double declining balance method charges depreciation at twice the straight line rate on the written down value
Hence, in the first year, depreciation under double declining balance method will be higher
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