Many Companies Use Accelerated Depreciation in Computing Taxable Income Because

question 75

Multiple Choice

Many companies use accelerated depreciation in computing taxable income because:

• A)It is required by the tax rules.
• B)It is required by financial reporting rules.
• C)It postpones tax payments until later years and the company can use the resources now to earn additional income before payment is due.
• D)Using it causes a company to use higher income in the early years of the asset's useful life.
• E)The results are identical to straight-line depreciation.

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Definitions:

Class

A group of individuals within a society who share similar socioeconomic status, often determined by factors like wealth, occupation, and education.

Absolute Poverty

A condition where an individual is unable to meet the minimum levels of income, food, clothing, healthcare, shelter, and other essentials for living.

Relative Poverty

A condition where individuals or families have significantly less income or resources than the average in their society or community.

Poverty

A socio-economic condition characterized by a lack of means to meet basic personal needs such as food, clothing, and shelter.