All of the Following Factors in Computing Depreciation Are Estimates

question 54

Multiple Choice

All of the following factors in computing depreciation are estimates except

• A) cost.
• B) residual value.
• C) salvage value.
• D) useful life.

Understand the components of a firm's capital, and their relative costs.

Calculate the after-tax cost of debt and understand its influence on the weighted average cost of capital (WACC).

Apply the dividend growth model to estimate the cost of common equity.

Differentiate between book value and market value and understand the relevance of each in calculating WACC.

---

Definitions:

Jacques Chirac

A former President of France who served from 1995 to 2007, known for his domestic policies and influence in international affairs.

ETA

An acronym for "Euskadi Ta Askatasuna," a Basque nationalist and separatist organization in Spain and France, known for its campaign of bombings, assassinations, and kidnappings in pursuit of independence for the Basque Country.

Violent Separatist

An individual or group advocating for the separation from a larger political entity through the use of violence and armed conflict.

Lech Walesa

A Polish statesman, dissident, and Nobel Peace Prize laureate who co-founded and led the Solidarity movement, leading to the end of communist rule in Poland.