Asked by Courtney Morris on May 14, 2024
Verified
Although most companies use straight-line depreciation for their financial statements,making valid comparisons across firms is often hindered due to differences in estimated useful lives.
Straight-Line Depreciation
A method of calculating the depreciation of an asset which allocates an equal portion of the asset's cost over each year of its useful life.
Useful Lives
The estimated period during which an asset is expected to be usable for the purpose for which it was acquired.
- Learn about the accounting practices for intangible long-lived assets and the assorted depreciation strategies.
Verified Answer
AW
Akeem WrightMay 20, 2024
Final Answer :
True
Explanation :
Different companies may estimate the useful lives of their assets differently, which can result in different amounts of depreciation expense each year. This can make it difficult to compare the financial statements of different companies that use straight-line depreciation.
Learning Objectives
- Learn about the accounting practices for intangible long-lived assets and the assorted depreciation strategies.
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