A Company Decided to Use the Units of Production Method

question 70

Multiple Choice

A company decided to use the units of production method to calculate depreciation on a car to be driven by the sales manager.The amount of annual depreciation will vary with which of the following?

• A)Age of the car.
• B)Balance in accumulated depreciation.
• C)Number of kilometres the car is driven.
• D)Amount of maintenance expense incurred on the car.

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Definitions:

Cognitive Biases

Systematic patterns of deviation from norm or rationality in judgment, leading individuals to make illogical decisions.

Overconfidence Effect

A cognitive bias where an individual's subjective confidence in their judgments is greater than their objective accuracy.

Confirmation Bias

The tendency to search for, interpret, favor, and recall information in a way that confirms one's preexisting beliefs or hypotheses.

Cognitive Biases

Cognitive biases are systematic patterns of deviation from norm or rationality in judgment, often leading to illogical interpretation or decision-making.