Which of the Following Is Correct

question 55

Multiple Choice

Which of the following is correct?

• A)The Continental Congress used the inflation tax to help finance the American Revolution.
• B)The inflation tax has been a principle source of revenue for the U.S.government.
• C)There is no way a person can avoid the inflation tax.
• D)None of the above is correct.

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Definitions:

Double-Declining-Balance

An accelerated depreciation method that doubles the straight-line depreciation rate, reducing the asset's book value more quickly.

Straight-Line

A method of calculating depreciation of an asset, which allocates an equal amount of depreciation each year over the asset's useful life.

Depreciation Expense

The allocation of the cost of a tangible asset over its useful life, reflecting the asset's consumption, wear and tear, or obsolescence.

Straight-Line Depreciation

A method of allocating the cost of a tangible asset over its useful life in an equal amount per year.