For a Company Using the Straight-Line Method of Depreciation That

question 31

Multiple Choice

For a company using the straight-line method of depreciation that changes the estimated useful life from 20 years to 15 years as at the beginning of the year, the accountant should do (or not do) the following:

• A)Compute current year depreciation as (carrying amount - residual value)divided by 20 years.
• B)Do not adjust prior year's depreciation.
• C)Adjust the amount of accumulated depreciation as at the beginning of the year.
• D)Compute current year depreciation as (carrying amount)× 15/20.

---

Definitions:

HMO

Health Maintenance Organization, a type of health insurance plan that requires members to receive healthcare services from a network of designated providers.

Providers

Entities or individuals that supply services or goods.

Medicare

A federal health insurance program in the United States for people aged 65 and older, and for some younger people with disabilities.

Brand Name Drugs

Medications sold under a proprietary, trademarked name, as opposed to their generic equivalents.