Which One of the Following Depreciation Methods Will Typically Result

question 37

Multiple Choice

Which one of the following depreciation methods will typically result in the smallest earnings per share during the early periods of an asset's life?

• A)150% declining balance method.
• B)Units of production method.
• C)Double-declining-balance method.
• D)Straight-line method.

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Definitions:

Gross Profit Method

An accounting technique used to estimate the amount of inventory a company has by using the gross margin percentage.

Control of Inventory

The process of overseeing and managing the ordering, storage, and use of components that a company will use in the production of the items it will sell as well as the management of quantities of finished products for sale.

Internal Control Steps

Procedures and mechanisms implemented by a firm to safeguard assets, enhance the reliability of financial reports, and comply with laws.

Reverse Order

A method of organizing or sequencing items so that the last becomes first and the first becomes last.