Management should select the depreciation method that
A)is easiest to apply.
B)best measures the asset's fair value each period over its useful life.
C)best reflects the pattern in which the asset's future economic benefits are to be consumed.
D)has been used most often in the past by the company.

Question

Quizplus · Accepted Answer

The depreciation method should best reflect the pattern in which the asset's future economic benefits are to be consumed. This means that the method should allocate the cost of the asset over its useful life in a way that accurately reflects how the asset will be used. This results in the most accurate representation of the company's financial statements. Choosing a method based on ease of application or past usage may not necessarily result in the most accurate representation of the asset's value.

Management Should Select the Depreciation Method That