As a Recent Graduate of State University You're Aware That

question 205

Multiple Choice

As a recent graduate of State University you're aware that IFRS requires component depreciation for plant assets. A friend has asked you to succinctly explain what component depreciation means. Which of the following correctly describes component depreciation?

• A)The method used to ensure that the depreciation rate remains constant from year to year.
• B)The method that requires that significant parts of a plant asset with different useful lives be depreciated separately.
• C)The method used to prorate annual depreciation on a time basis.
• D)The method of depreciation recommended for an asset that is expected to be significantly more productive in the first half of its useful life.

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