The Sum-Of-The-Years'-Digits Method of Depreciation Is Being Used for a Machine

question 11

Multiple Choice

The sum-of-the-years'-digits method of depreciation is being used for a machine with a five-year estimated useful life. What would be the fraction applied to the cost to be depreciated in the fourth year?

• A) 4/5
• B) 2/5
• C) 4/15
• D) 2/15

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Definitions:

General Journal Entries

Recorded accounting transactions in the general journal that detail the financial activities of a business.

Transactions

Transactions refer to the exchange of goods, services, or financial assets in business activities.

Journal Entries

The method of recording financial transactions in an accounting system, where each transaction is entered twice to maintain the balance of the accounting equation.

Transactions

The events or interactions between businesses or individuals that have economic substance and can be measured in terms of money.