If the Estimate of an Asset's Useful Life Is Changed

question 70

Multiple Choice

If the estimate of an asset's useful life is changed, then

• A) Depreciation expense for all past periods must be recalculated
• B) There is no change in the amount of depreciation expense recorded for future years
• C) Only the depreciation expense in the remaining years is changed
• D) None of these are true

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Definitions:

Variable Product Cost

The costs associated with producing a product that vary with the level of production, including materials and labor directly linked to the production volume.

Hard Drive

A data storage device used for storing and retrieving digital information, utilizing magnetic storage.

Variable Costs

Costs that vary directly with the level of production or output, such as materials and labor.

Cost of Goods Manufactured

The total production cost of goods completed and moved out of work-in-process inventory during a period, including labor, materials, and overhead.