Methods of accelerated depreciation:
A) allow more total depreciation over the asset's life.
B) decrease the depreciation tax shield.
C) increase the depreciation tax shield.
D) allow assets to be depreciated more rapidly.

Question

Quizplus · Accepted Answer

Methods of accelerated depreciation allow assets to be depreciated more rapidly, which means that more depreciation expenses are recognized in the earlier years of an asset's life. This, in turn, increases the depreciation tax shield, reducing taxable income and therefore reducing the tax liability.

Methods of Accelerated Depreciation