The units-of-production method provides the closest matching of a long-lived asset's depreciation expense to the revenues generated by using that asset when the:
A)amount of production is the highest in the early years of an asset's life and lower in later years.
B)long-lived asset is used by a merchandising operation.
C)amount of production remains fairly constant from one period to the next.
D)amount of asset production varies significantly from one period to the next.

Question

Quizplus · Accepted Answer

The units-of-production depreciation method is chosen when the amount of asset production varies significantly from period to period.Under these circumstances,it offers the best matching between depreciation expense and asset usage.

The Units-Of-Production Method Provides the Closest Matching of a Long-Lived