Once the Estimated Depreciation Expense for an Asset Is Calculated

question 158

Multiple Choice

Once the estimated depreciation expense for an asset is calculated:

• A)It cannot be changed,based on the historical cost principle.
• B)It may be revised based on new information.
• C)Any changes are accumulated and recognized when the asset is sold.
• D)The estimate itself cannot be changed;however,new information should be disclosed in financial statement footnotes.
• E)It cannot be changed,based on the consistency principle.

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Definitions:

Stable

Characterizing something that is unchanging, consistent, or not easily disturbed or upset over time.

Actor-observer Effect

The tendency to attribute one's own actions to external causes while attributing other people's behaviors to their internal characteristics.

External

Outside of or existing beyond the self or the entity it refers to, often used in contrast with internal.

Internal

Relating to or situated on the inside; intrinsic or inner attributes.