Asked by Hunter Kinnett on May 17, 2024
Verified
Under what conditions would a company most likely adopt the double-declining-balance method for financial reporting?
A) The company has high technology,robotic equipment in its plant that becomes obsolete quickly and declines in utility to the company more rapidly in the early years of the assets' lives.
B) The company wants to maximize its net income during the earlier years of the asset's life.
C) The company wants to maximize the asset's book value in the earlier years of the asset's life.
D) The company wants to maximize the total depreciation expense over the life of the asset.
Double-Declining-Balance Method
A method of accelerated depreciation that doubles the straight-line depreciation rate and applies it to the remaining book value each year.
Financial Reporting
The process of producing statements that disclose an organization's financial status to management, investors, and the government.
High Technology
Refers to the most advanced technology available, often characterized by innovative, cutting-edge developments in fields such as information technology, robotics, and biotechnology.
- Comprehend the distinctions, uses, and effects of different depreciation techniques on financial reports.
- Understand the influence of depreciation techniques on financial metrics and organizational financial outcomes.
Verified Answer
Learning Objectives
- Comprehend the distinctions, uses, and effects of different depreciation techniques on financial reports.
- Understand the influence of depreciation techniques on financial metrics and organizational financial outcomes.
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