Why Is It Likely That Firms Use Straight-Line Depreciation Methods

question 104

Multiple Choice

Why is it likely that firms use straight-line depreciation methods for reporting to shareholders?

• A) It increases the NPV of the project.
• B) It decreases the tax liability of the project.
• C) It mirrors the market value of the assets.
• D) It allows asset balances to decline more slowly.

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