A benefit of using an accelerated depreciation method is that:
A)It is preferred by the tax code.
B)It is the simplest method to calculate.
C)It yields larger depreciation expense in the early years of an asset's life.
D)It yields a higher income in the early years of the asset's useful life.
E)The results are identical to straight-line depreciation.

Question

Quizplus · Accepted Answer

Accelerated depreciation methods yield larger depreciation expense in the early years of an asset's life, which can be advantageous for tax purposes or when trying to match expenses with revenue. This can result in lower taxes and an increased cash flow in the earlier years of an asset's use.

A Benefit of Using an Accelerated Depreciation Method Is That