With Regard to Depreciation, the Time Value of Money Concept

question 99

Multiple Choice

With regard to depreciation, the time value of money concept tells us that

• A) delaying the depreciation expense is always better.
• B) taking the depreciation expense sooner is always better.
• C) delaying the depreciation expense is sometimes better.
• D) taking the depreciation expense sooner is sometimes better.

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Definitions:

Target Profit

The amount of profit that a company aims to make in a certain period.

Annual Fixed Expenses

Expenses that do not change in total over a period of one year, regardless of the level of activity within a business.

Sales Mix

The combination of different products or services that a company sells, typically analyzed to determine the most profitable mix.

Sales Mix

The combination of products or services that a company sells, reflecting the variation in profit margins for each.