A Graph Depicting Yearly Depreciation Expense Under the Production Method

question 18

Multiple Choice

A graph depicting yearly depreciation expense under the production method will contain a line that

• A)goes horizontally across.
• B)goes down as one goes from left to right.
• C)cannot be predicted.
• D)goes up as one goes from left to right.

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Definitions:

Accounting Period

A specific period of time for which financial information is reported, typically a fiscal year or quarter.

Expense Accounts

Accounts in the general ledger representing the various costs incurred by a company in the course of its operations, excluding product cost.

Accrual Method

An accounting technique that records revenues and expenses when they are incurred, regardless of when cash transactions occur.

Reversing Entries

An accounting method used to reverse journal entries, typically at the beginning of a new accounting period, to cancel adjustments made in the previous period.