Choose the Statement About Depreciation That Is Correct

question 10

Multiple Choice

Choose the statement about depreciation that is correct.

• A)Yearly depreciation will always be higher using the straight-line method.
• B)At the end of the asset's useful life, total depreciation charged will be the same whichever depreciation method is used.
• C)Yearly depreciation will always be lower using the units of use method.
• D)Yearly depreciation will always be higher using the reducing-balance method.

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Definitions:

Income Effect

Variations in the income levels of individuals or economies and the resultant effects on the demand for goods or services.

Substitution Effect

The economic understanding that as prices rise or incomes decrease consumers will replace more expensive items with less costly alternatives.

Hourly Wages

The amount of earnings paid to an employee for each hour worked.

Fringe Benefits

Additional benefits, beyond a salary, offered to employees, such as health insurance, retirement plans, and paid time off.