A method that ignores residual value in calculating periodic depreciation expenses in the earlier part of an asset's useful life is the * O group composite method. O sum-of-the-years'-digits method. O productive-output method. O double-declining-balance method.

A method that ignores residual value in calculating periodic depreciation expenses in the earlier part of an asset's useful life is the * O group composite method. O sum-of-the-years'-digits method. O productive-output method. O double-declining-balance method.

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter18: Accounting For Long-term Assets

Section: Chapter Questions

Problem 4TF: The straight-line method of depreciation allocates the cost of an asset more rapidly than the...

See similar textbooks

Related questions

Q: Which of the following methods applies a declining depreciation rate each period to an asset's…

A: Sum-of-the-years' digits Method: Calculating the predicted depreciation of an asset over time using…

Q: In solving for the annual cost of an asset, yearly depreciation is considered an expense. During the…

A: Depreciation is defined as the reduction in the value of fixed asset due to normal wear & tear,…

Q: Acton, Inc., uses the double-declining-balance method for depreciation on itscomputers. Which item…

Q: Which of the following depreciation methods initially ignores salvage value in its calculation?…

A: Depreciation is a way of declining the cost of assets over the useful life of assets, the company…

Q: Which of the following methods of computing depreciation is variable in nature? a) Straight-line Ob)…

A: Solution: Depreciation method that is variable in nature is considered to be the method which ensure…

Q: Residual value is: A. Also called residual value. B. Also called scrap value. C. An estimate of the…

A: The depreciation expense is charged on fixed assets as reduced value of the fixed asset with usage…

Q: Explain the justification for following each method of depreciation: - staight line method -…

A: An expense incurred as a result of machinery or other asset usage during the year refers to the…

Q: Which method of computing depreciation expense results in the same amount of depreciation each year?…

A: Different methods of depreciation : 1. straight line method 2. Double declining balance method 3.…

Q: Contrast the effects of the straight-line, declining-balance, and activity-based methods on annual…

Q: What is the systematic periodic transfer of the cost of a fixed asset to an expense account during…

A: It is a measure of the wearing out, consumption or other loss of value of depreciable asset arising…

Q: which method of depreciation is used when the cost of an asset is written off in equal amounts over…

A: Depreciation represents the reduction in the value of an asset over an expected life.

Q: Over the life of a depreciable asset, its recorded cost decreases, the related accumulated…

A: Asset is recorded in the books of account at cost which is depreciated over the useful life of an…

Q: Which depreciation method calculates annual depreciation expense based on the book value of an…

A: The regular fall in the worth of an asset due to its usage is known as depreciation.

Q: The units-of-production method of depreciation charges a varying amount of expense for each period…

A: Depreciation expense based on the units-of-production method charges the depreciation for each based…

Q: Combo Co. computes depreciation on the straight-line method. Based on the information presented, the…

A: Composite Rate= Total Annual Depreciation for All AssetTotal Cost of All Asset Composite Life=…

Q: Which depreciation method calculates annual depreciation expense based on the book value of an…

A: Due to various reasons such as Normal wear & Tear, change in technology, obsolescence, etc., the…

Q: When the estimate of an asset's useful life is changed, select the false statement a. depreciation…

A: Depreciation refer to fall in the value of asset every year. It is an accounting word that refers to…

Q: Which depreciation method results larger depreciation expense in the early years of an asset's life…

A: Which depreciation method results larger depreciation expenses in the early years of an asset's life…

Q: Please explain double-declining method depreciation. When is this the preferred method to figure…

A: The double-declining balance method is a method to calculate depreciation. Depreciation as per…

Q: What is the double declining balance depreciation calculation? O Long-term assets that lack physical…

A: Double Declining balance method of depreciation: This is one of the methods to calculate the…

Q: Which of the following best describes depreciation? A.ccounts for the market value of a physical…

A: Depreciation is an expense which is shown and recorded in the expense side of the income statement.

Q: Which of the following will maximize net income by minimizing depreciation expense in the first year…

A: In the first year of asset's life, depreciation expense can be minimised by maximising net income by…

Q: Under which depreciation method may depreciation reduce the book value below the asset's residual…

A: Depreciation Definition: Decreasing value of fixed Asset during the period of time. According to…

Q: Under what depreciation method(s) is an asset’s bookvalue used to calculate depreciation each…

A: Depreciation: Depreciation is a method of reducing the capitalized cost of long-lived operating…

Q: fhich of the tfollowing statement best describes depreciation? a. It is a means of spreading the…

A: Fixed assets: These are the assets which were used in the business for more than one year. These…

Q: Evaluate the consequences of depreciation charged on the historical cost of the assets. I)…

A: Please see the next step for the solution

Q: Why does the depreciation included in computing the annual cost of annual worth method but not in…

A: Depreciation is a separate provision for fixed assets. Fixed amount is charged out of profit during…

Q: Which of the following depreciation methods can NOT depreciate an asset below its salvage value?…

A: Solution: As per GAAP, asset can not be depreciated below its salvage value.

Q: The units-of-production method of depreciation charges a varying amount of expense for each period…

A: Answer:- TRUE Under this method of depreciation, the amount of depreciation charged to expense is…

Q: A method that excludes residual value from the depreciation base for the calculation of depreciation…

A: The depreciation expense is charged on fixed assets as reduction in value of fixed assets with the…

Q: Assuming that it will have no residual value, determine the depreciation for each of the first two…

Q: The depreciation method that produces larger depreciation expense during the early years of an…

A: Any depreciation technique that allows for the recording of larger depreciation expenditures in…

Q: When a number of low-cost depreciable assets with similar characteristics, service lives, and…

A: Group depreciation refers to that method of charging depreciation where the assets having similar…

Q: The following would affect the net income on the last year of the useful life of a long-lived asset…

A: Long lived assets are the fixed assets of the business, which are held by the business for the…

Q: Which method of computing depreciation expense results in the amount of depreciation for each year…

A: Unit of Production Method:-This method calculates depreciation for the unit produces in a year…

Q: Which statement about depreciation is false?a. A major objective of depreciation accounting is to…

A: Answer: Option b.

Q: Which of the following is not a factor in computing depreciation for a period? present value…

A: SOLUTION- Present value is not a factor for calculating depreciation.

Q: Under the historical accounting system, depreciation is calculated on the original cost of fixed…

A: The question is multiple choice question. Required Choose the Correct Option.

Q: The allocation of the cost of a tangible asset to expense in the periods in which the asset is used…

A: Tangible assets are physical assets of a company such as land, building, machine which is used to…

Q: Group or composite depreciation: Requires changing the composite rate each year. Usually records a…

A: Depreciation means allocation of cost of asset over the useful life of the asset, because every…

Q: Which of the following statements is true when the straight-line method is used to compute…

A: Using Straight line method , Amortization Expense = Amortization cost / Asset's estimated useful…

Q: In conducting a replacement study of assets with different lives, can the annual worth values over…

A: Replacement study uses the replacement cash flows during the period under consideration to calculate…

Q: Evaluate the following statements: S1. In the sum-of-the-years'-digits method, residual value is…

A: Under sum of years digit method initially depreciable base is calculated and having the depreciable…

Q: One accelerated depreciation method is called fixed-percentage-of-declining-balance. Explain what is…

Q: Which of the following is considered an accelerated depreciation method? Multiple Choice…

A: Depreciation means the loss in value of assets because of usage of assets , passage of time or…

Q: haracteristics of Depreciation Methods In each dropdown below is a list of common depreciation…

A: Assets: Assets are the resources of an organization used for the purpose of business operations.…

Q: A method of depreciation whereby the amount to recover is spread uniformly over the estimated life…

A: Depreciation refers to the reduction in the value of asset due to its normal use and tear and wear.…

Concept explainers

Market Efficiency

Market efficiency refers to the market's ability to provide investors with all available information about investment options for buying and selling securities. Market efficiency reflects the true value of securities without undervaluing or overvaluing them. When the quality and quantity of information increase, the market becomes more efficient, allowing it to reduce arbitrage and obtain higher market returns from investment. In a well-functioning market, everyone receives all information completely and immediately at no cost. It opens up a plethora of opportunities for investors to access various investment options.

Question

100%

question 44

A method that ignores residual value in calculating periodic depreciation expenses in the
earlier part of an asset's useful life is the *
O group composite method.
sum-of-the-years'-digits method.
O productive-output method.
double-declining-balance method.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Introduction

VIEW

Correct Answer Explanation

VIEW

Incorrect Answer Explanation

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

The straight-line method of depreciation allocates the cost of an asset more rapidly than the sum-of-the-years-digits method.
Characteristics of Depreciation Methods Below is a common list of depreciation methods and characteristics related to depreciation. Depreciation Methods a. Straight-line depreciation method b. Declining balance depreciation method c. Units-of-production depreciation method when actual units produced increases over the life of the asset Characteristics 1. Results in depreciation expense that decreases over the life of the asset. 2. Results in depreciation expense that increases over the life of the asset. 3. Allocates the same amount of cost to each period of a depreciable assets life. 4. Calculated by multiplying a constant depreciation rate by depreciable cost. 5. Calculated by applying a constant depreciation rate to the assets book value at the beginning of the period. 6. Results in lowest income taxes in early years of the assets life. 7. Consistent with the matching principle. Required: Match one or more of the depreciation methods with each characteristic.
An accelerated depreciation method that takes more expense in the first few years of the assets life is ________. A. units-of-production depreciation B. double-declining-balance depreciation C. accumulated depreciation D. straight-line depreciation
Which depreciation method ignores residual value when computing the depreciable base of an asset? a. sum-of-the-year's-digits b. double-declining-balance c. composite depreciation d. group depreciation
Which of the statements is incorrect concerning the depreciation methods? * a. Under the output method, the cost per unit of production is constant. b. The straight-line method is particularly appropriate where the asset is expected to decline in usefulness as a function of time and the expected use pattern of the asset is fairly constant over time. c. The sum of the years' digits method provides for a decreasing depreciation charge. d. First-year depreciation under the double declining balance method is computed as the depreciable amount multiplied by double the straight line rate. . None of the choices is incorrect
Which of the following statements is true? - When using the double-declining-balance method, the total amount of depreciation expense during the life of the asset will be the highest. -When using the units-of-output method, it is possible to depreciate more than the depreciable cost. -When using the straight-line method, the amount of depreciation expense during the first year is higher than that of the double-declining-balance. -Regardless of the depreciation method, the amount of total depreciation expense during the life of the asset will be the same.
Acton, Inc., uses the double-declining-balance method for depreciation on itscomputers. Which item is not needed to compute depreciation for the first year?a. Estimated residual valueb. Expected useful life in yearsc. Original costd. All the items listed are needed.
Which of the following methods applies a declining depreciation rate each period to an asset's constant value? a.Double-declining-balance methodb.Straight-line methodc.Sum-of-the-years'-digits methodd.Units-of-production method
Which of the following is true? a.If using the units-of-output method, it is possible to depreciate more than the depreciable cost. b.If using the double-declining-balance method, the total amount of depreciation expense during the life of the asset will be the highest. c.If using the straight-line method, the amount of depreciation expense during the first year is higher than that of the double-declining-balance. d.Regardless of the depreciation method, the amount of total depreciation expense during the life of the asset will be the same.
A method that excludes residual value from the depreciation base for the calculation of depreciation is: a. straight-lineb. sum-of-the-years'-digitsc. double-declining-balanced. activity
Which of the following depreciation methods will result in the most depreciation expense over the life of an asset? Select one: a. Double-declining balance method b. All three methods will result in the same amount of depreciation expense. c. Units-of-production method d. Straight-line method e. Cannot be determined from the information given.
Indicate whether each of the following statements is true or false. Depreciation, depletion, and amortization all involve the allocation of the cost of property, plant and equipment (PPE) to expense. Answer An accelerated depreciation method is appropriate when the asset’s economic usefulness is the same each year Answer The declining-balance method does not deduct the residual value in computing the depreciation base. Answer