Once the Estimated Depreciation Expense for an Asset Is Calculated

question 29

Multiple Choice

Once the estimated depreciation expense for an asset is calculated:

• A) It cannot be changed due to the historical cost principle.
• B) It may be revised based on new information.
• C) Any changes are accumulated and recognized when the asset is sold.
• D) The estimate itself cannot be changed; however, new information should be disclosed in financial statement footnotes.
• E) It cannot be changed due to the consistency principle.

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Definitions:

Inductive Reactance

The resistance offered by an inductor to the flow of alternating current, measured in ohms.

Impedance

The total resistance to the flow of alternating current (AC) in a circuit, comprising both resistive and reactive components, measured in ohms.

Inductive Reactance

The opposition that an inductor presents to alternating current, due to the inductor's inductance, measured in ohms.

Power (P)

The rate at which electrical energy is transferred by an electric circuit, usually measured in watts (W).