An Asset Purchased for $120 000 with a Zero Residual

question 28

Multiple Choice

An asset purchased for $120 000 with a zero residual value was expected to last for six years before it needed replacing. If, at the end of the fourth year, it was decided to extend the asset's total useful life by two years (new remaining life is now eight years) , the new depreciation charge using the straight-line approach would be:

• A) $5 000
• B) $10 000
• C) $12 000
• D) $20 000

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Definitions:

Operant Behavior

Behavior that is controlled by its consequences, including rewards and punishments, in the context of operant conditioning.

Functional Analysis

In behaviorism, a description of how a behavior is a function of the environment of the person or animal that performs it.

Empiricism

The philosophical perspective that knowledge comes primarily from sensory experience and observation.

Operant Conditioning

Skinner’s term for the process of learning in which an organism’s behavior is shaped by the effect of the behavior on the environment.