The straight-line method is frequently used to amortize non-refundable rental payments made in advance on leased assets because:
A)It is less complex, therefore, less costly.
B)IFRS requires that it be used in all situations.
C)It is more theoretically sound.
D)The interest method may result in unreliable amounts being recognized as expense.

Question

Quizplus · Accepted Answer

The straight-line method is often chosen for its simplicity and lower cost of implementation compared to methods that might require more complex calculations, such as the interest method. This simplicity makes it a practical choice for amortizing non-refundable rental payments made in advance.

The Straight-Line Method Is Frequently Used to Amortize Non-Refundable Rental