A Decrease in Which One of the Following Will Increase

question 13

Multiple Choice

A decrease in which one of the following will increase the gross margin?

• A) taxes
• B) sales
• C) depreciation
• D) variable costs
• E) fixed costs

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Definitions:

Straight-line

A method of depreciation that allocates an equal expense rate to each year of an asset’s useful life.

Accelerated Methods

Depreciation methods that allocate more depreciation expense to the earlier years of an asset's life.

Depreciation

Strategically spreading out the cost of a tangible asset throughout its period of usefulness.

Accounting Estimate

An approximation of a financial transaction's value when precise measurement is not possible, often used in accrual accounting.