The Interest Rate Expressed as If It Were Compounded Once

question 394

Multiple Choice

The interest rate expressed as if it were compounded once per year is called the _____ rate.

• A) Stated interest.
• B) Compound interest.
• C) Effective annual.
• D) Periodic interest.
• E) Daily interest.

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Definitions:

Double-Declining-Balance Method

An accelerated method of depreciation that doubles the normal depreciation rate.

Journal Entry

A record of a transaction in the accounting journal that may affect one or more accounts.

Residual Value

The projected worth of an asset at the time of sale, after it has served its purpose.

Accumulated Depreciation

The cumulative depreciation of an asset up to a single point in its life, representing the wear and tear, deterioration, or obsolescence of the asset.