Which of the Following Is the Correct Formula for Calculating

question 149

Multiple Choice

Which of the following is the correct formula for calculating depreciation under the straight-line method?

• A) Straight-line depreciation = (Cost + Residual value) / Useful life
• B) Straight-line depreciation = (Cost - Residual value) / Useful life
• C) Straight-line depreciation = (Cost + Residual value) × Useful life
• D) Straight-line depreciation = (Cost - Residual value) × Useful life

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Definitions:

Known Current Liabilities

Short-term financial obligations that are recognized and recorded, expected to be settled within one year or within the normal operating cycle.

Liabilities

Financial obligations or debts that a company owes to others, which must be settled over time through the transfer of economic benefits including money, goods, or services.

Contingent Liabilities

Contingent liabilities are potential liabilities that may occur depending on the outcome of a future event.

Account

A record in bookkeeping that tracks financial transactions of a specific type, such as assets, liabilities, expenses, or revenue.