(d) On what basis should management select from these two methods to depreciate the machine? Justify in your own words (e) What do you feel may be the difference between these two methods of computing depreciation? Explain in your own words

(d) On what basis should management select from these two methods to depreciate the machine? Justify in your own words (e) What do you feel may be the difference between these two methods of computing depreciation? Explain in your own words

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter17: Activity Resource Usage Model And Tactical Decision Making

Section: Chapter Questions

Problem 5DQ: What is a relevant cost? Explain why depreciation on an existing asset is always irrelevant.

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Question

i provided answers af a b c i need e and d

(d) On what basis should
management select from these two
methods to depreciate the machine?
Justify in your own words
(e) What do you feel may be the
difference between these two
methods of computing depreciation?
Explain in your own words

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Depreciation continues to be one of the most controversial, difficult, and important problem areas in accounting. Required: 1. Explain the conventional accounting concept of depreciation accounting, and discuss its conceptual merit with respect to (a) the value of the asset, (b) the amount(s) expensed, and (c) the discretion of management in selecting the method. 2. Answer the following: a. Explain the factors that should be considered when applying the conventional concept of depreciation to the determination of how the value of a newly acquired computer system should be assigned to expense for financial reporting purposes. (Ignore income tax considerations for this case.) b. What depreciation methods might be used for the computer system?
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