Which of the Following Methods Ignores Residual Value Initially but Eventually

question 90

Multiple Choice

Which of the following methods ignores residual value initially but eventually considers it in the calculation of depreciation?

• A)Straight-line
• B)Double-declining-balance
• C)Group
• D)Production

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Definitions:

PV Of After-Tax Lease Payments

The present value of after-tax lease payments is the current worth of all lease payments to be made over the lease term, adjusted for taxes.

Original Investment

The initial amount of money or capital put into an investment vehicle or project.

PV Of CCA Tax Shield

The present value of the tax savings a company realizes from being able to deduct the Capital Cost Allowance on its tax return.

PV Of After-Tax Lease Payments

This represents the present value of lease payments made over the lease term, adjusted for tax implications.