Which of the Following Statements Is Not True

question 18

Multiple Choice

Which of the following statements is not true?

• A)The depreciation method and the period of time selected to depreciate an asset can have a significant influence on income.
• B)There are many depreciation methods.
• C)The depreciation methods that recognize a large amount of depreciation in the later years of an asset's life are conservative.
• D)The straight-line depreciation method recognizes depreciation in equal amounts over each year of the life of the asset.
• E)There is sometimes a material difference in the lives used for depreciation between firms.

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Definitions:

Variable Costing

An accounting method that considers only variable costs in determining the cost of goods sold and evaluates profitability.

Direct Labor Cost

The total cost of wages paid to workers directly involved in the manufacturing or production of goods or services.

Income Statement

A financial report that shows a company's revenues, expenses, and net income over a specific period, highlighting its profitability.

Unit Product Cost

The total cost associated with producing and delivering a single unit of product, including direct labor, materials, and overhead.