A Company Purchased a Computer on 1 July 2014

question 97

Multiple Choice

A company purchased a computer on 1 July 2014. The computer has an estimated useful life of 5 years and will have no residual value. It was purchased for $10 000. It is estimated that the computer can be used for 5 000 hours. The computer was used for 450 hours during 2014. If the goal is to record higher depreciation expense in the earlier years, which method should be used?

• A)First- In, First- Out
• B)Reducing- balance
• C)Units- of- production
• D)Straight- line

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Definitions:

Procedural Safeguards

Legal protections provided to individuals, especially in the context of administrative or legal proceedings, to ensure fairness and prevent arbitrary decision-making.

Amendments

Changes or additions made to a document, legislation, contract, or constitution, typically involving formal procedures for approval and implementation.

U.S. Constitution

The foundational document of the United States that delineates the national frame of government, its institutions, and the rights of its citizens.

Insider Trading

Trading in the stock of a publicly listed corporation based on inside information. One who possesses inside information and has a duty not to disclose it to outsiders may not profit from the purchase or sale of securities based on that information until the information is available to the public.