Accounting 2 - Depreciation Methods

Which is the simplest method to calculate depreciation?

• Units of Output
• Accelerated Depreciation Method
• Straight Line with Half Year Convention
• Straight Line Method

Which depreciation method is able to match revenues with expenses?

• Accelerated Depreciation Method
• Units of Output
• Straight Line Method
• Straight Line Method with half year convention

Which depreciation method is used for tax purpose?

• Accelerated Depreciation Method
• Straight Line Method
• Units of Output
• None of the Above

Which depreciation method shows same depreciation expense every year of the useful life?

• Straight LIne Method
• Accelerated Depreciation Method
• Units of Output
• None

Which depreciation method applies a half-year depreciation expense in both the first and last years of an asset’s useful life?

• Straight Line Method
• Straight Line method with half year convention
• Units of output
• None of the above

What is Net Book Value?

• Cost of the Asset - Accumulated Depreciation
• Accumulated Depreciation - Depreciation Expense
• Cost - Depreciation Expense
• None of the Above

Maintenance and Repair is not the cost of the asset.

• True
• False

Formula to calculate depreciation expense using accelerated depreciation method:

• Remaining Book Value * Depreciation Expense
• Remaining Book Value* Accelerated Depreciation Rate
• Cost* Accelerated Depreciation Rate
• None of the Above

When the accelerated depreciation rate is twice the straight-line rate, it is known as the Double Declining Balance Method.

• True
• False

When plant assets are sold, any gain or loss on the disposal is computed by comparing the book value with the amount received from the sale.

• True
• False