Which of the Following Is Not an Objection to the Use

question 112

Multiple Choice

Which of the following is not an objection to the use of the straight-line method of amortization?

• A) It may not satisfactorily match expense with revenue, depending on the asset.
• B) It tends to ignore obsolescence as a major source of decline in economic value.
• C) It does not recognize the investment characteristics of the ownership of capital assets.
• D) it generally results in the lowest earnings.

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Definitions:

Long-run Equilibrium

A state in which economic forces such as supply and demand are balanced, occurring when the level of output is sustainable in the long term without creating inflation.

Labor Force

The total number of people available for work, including both the employed and the unemployed who are seeking employment.

Price Level

A measure of the average prices of goods and services in an economy.

Net Investment

The total amount spent by a company or economy on capital assets, minus depreciation.