Which of the Following Are U

question 46

Multiple Choice

Which of the following are U.S.taxpayers allowed to adjust for inflation for the purpose of income taxes?

• A)both interest income and capital gains.
• B)interest income but not capital gains.
• C)capital gains but not interest income.
• D)neither interest income nor capital gains.

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Definitions:

Double-declining-balance

A method of accelerated depreciation where the depreciation expense decreases over time, doubling the rate of straight-line depreciation.

Salvage Value

The forecasted resale price of an asset at the end of its service life.

Depreciation Expense

An accounting method used to allocate the cost of a tangible or physical asset over its useful life, reflecting wear and tear, deterioration, or obsolescence of the asset.

Straight-line Method

A method of calculating depreciation for an asset, spreading the cost evenly over its useful life.