The Method of Depreciation Was Changed from the Double-Declining-Balance Method

question 12

Multiple Choice

The method of depreciation was changed from the double-declining-balance method to the straight-line method in fiscal 2013. A machine was purchased on January 1, 2011, at a cost of $150,000. The machine has an estimated useful life of 10 years and a residual value of $9,000. Assume that net income before tax NIBT) was $102,000 for fiscal 2012. What is the appropriate accounting for fiscal 2012?

• A)Retrospective adjustment and revised NIBT of $87,900.
• B)Retrospective adjustment and revised NIBT of $126,000.
• C)Retrospective adjustment and revised NIBT of $111,900.
• D)No accounting is necessary in fiscal 2012.

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Definitions:

Deep Brain Stimulation

A neurosurgical procedure that involves implanting electrodes within certain areas of the brain to regulate abnormal impulses in conditions like Parkinson's disease.

Pregnant

The state of carrying a developing fetus within the female body.

Monitoring Thoughts

The practice of observing and reflecting on one’s own thoughts, often used in cognitive behavioral therapy to challenge negative patterns.