Many Companies Use Accelerated Depreciation in Computing Taxable Income Because

question 241

Multiple Choice

Many companies use accelerated depreciation in computing taxable income because:

• A)it reports higher net income in the early years as compared to other methods.
• B)it is required by IFRS.
• C)it is easier than straight-line deprecation.
• D)it postpones tax payments until later years because it lowers taxable income in the early years.

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Definitions:

Food

Nutritious substances that people or animals eat or drink to maintain life and growth.

Relatively Elastic

Describes a situation where a small change in price leads to a larger change in quantity demanded or supplied.

Price Decline

A decrease in the cost of goods or services, often resulting from lower demand, increased supply, or external market factors.

Supply Curve

A curve that illustrates the supply for a product by showing how each possible price (on the vertical axis) is associated with a specific quantity supplied (on the horizontal axis).