Which Depreciation Method Best Matches the Pattern by Which the Following

question 40

Multiple Choice

Which depreciation method best matches the pattern by which the following contribute to income: 1. a building; 2. a motor vehicle?

• A) 1. straight-line, 2. reducing-balance
• B) 1. straight-line; 2. straight-line
• C) 1. reducing-balance; 2. straight-line
• D) 1. reducing-balance; 2. reducing-balance

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Definitions:

Net Income

It refers to the bottom line of a company's income statement, indicating the earnings after all deductions.

Noncash Activities

Financial transactions that do not involve the immediate transfer of cash, often reflected in supplemental disclosures in cash flow statements.

Financing Activities

Transactions involving changes in equity and long-term liabilities on the company's balance sheet.

Statement of Cash Flows

A financial report that provides aggregate data regarding all cash inflows and outflows a company receives.