When the Amount of Use of a Fixed Asset Varies

question 90

Multiple Choice

When the amount of use of a fixed asset varies from year to year, the method of determining depreciation expense that best matches allocation of cost with revenue is

• A) double-declining-balance method
• B) straight-line method
• C) units-of-output method
• D) MACRS

---

Definitions:

Exchange Rate

The rate at which one currency will be exchanged for another currency.

Functional Currency

The primary currency used by a business or unit in its financial statements, reflecting the economic environment in which it operates.

Foreign Operation

This term refers to a business or branch operation located in a country different than the headquarters or parent company.