Which of the Following Depreciation Methods Writes Off a Higher

question 138

Multiple Choice

Which of the following depreciation methods writes off a higher amount of depreciation in earlier years than in later years?

• A)the units-of-production
• B)the straight-line
• C)the double-declining-balance
• D)the first-in, first-out

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Definitions:

Acid Test Ratio

A financial metric that measures a company's ability to pay off its current liabilities with quick assets, such as cash, marketable securities, and accounts receivable, without selling inventory.

Acid Test Ratio

A financial metric that measures a company's ability to pay off its current liabilities with its quick assets (cash, marketable securities, and receivables).

Temporary Investments

Investments not intended to be held for a long term and may include stocks or bonds, classified for easy liquidation.

Debts to Total Assets Ratio

A financial metric indicating the proportion of a company's assets that are financed through debt, assessing financial leverage.