Which of the Following Statements Relating to the Composite-Rate Depreciation

question 28

Multiple Choice

Which of the following statements relating to the composite-rate depreciation approach is not correct?

• A) Composite-rate depreciation always uses the straight-line method of depreciation.
• B) It is often used in practice by business entities with many similar assets in the one class.
• C) A single average depreciation rate is applied to the average of the beginning and ending balances of a functional group of assets.
• D) No gain or loss is recognised on the disposal of individual assets within the composite group.

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