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    Question

    Refer to the following information to answer the next 4 questions (Q15 to Q18) Depreciation is an accounting method used to allocate the cost of a tangible asset over its useful life. Tangible assets, such as machinery, vehicles, buildings, and equipment, gradually lose their value over time due to factors such as wear and tear, obsolescence, or technological advancements. Depreciation reflects this decrease in value and helps businesses accurately represent the true cost of using an asset in their financial statements. There are various methods of calculating depreciation, each method has its own set of rules and assumptions, and the choice of method often depends on factors such as the nature of the asset and its expected pattern of use. Depreciation is a crucial concept in accounting that helps businesses accurately account for the wear and tear of tangible assets, ensuring that financial statements provide a more realistic picture of the costs associated with using these assets over their useful lives.

    Depreciation remains constant according to which method?

    A Sum of years digit Correct Answer Incorrect Answer
    B Units of production Correct Answer Incorrect Answer
    C Declining Balance Correct Answer Incorrect Answer
    D Straight Line Method Correct Answer Incorrect Answer
    E None of the above Correct Answer Incorrect Answer

    Solution

    It is the least difficult method for working out the deficiency of worth of a resource after some time. The straight-line is determined by splitting the distinction between a resource's expense and its normal rescue esteem by the number of years it is relied upon to be utilized.

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