For Income Statement Purposes, Depreciation Is a Variable Expense If

question 32

Multiple Choice

For income statement purposes, depreciation is a variable expense if the depreciation method used for book purposes is

• A) Units of production
• B) Straight line
• C) Sum-of-the-year's-digits
• D) Declining balance

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Definitions:

Completed Contract

This accounting practice records the income and expenses of projects after they are finalized, ensuring financial statements only reflect finished work.

Percentage-of-Completion

An accounting method that recognizes revenues and expenses in relation to the completion percentage of a project.

Revenue Recognition

The accounting principle dictating the specific conditions under which income becomes recognized as revenue on the financial statements.

Accounting System

An accounting system is the method by which financial information is collected, processed, and reported to stakeholders.