Company A uses an accelerated depreciation method while Company B uses the straight-line method.All other things being equal,during the first few years of the asset's use,Company A will show which of the following compared to Company B?
A)Higher asset values and higher net income.
B)Lower asset values and higher net income.
C)Higher asset values and lower net income.
D)Lower asset values and lower net income.

Question

Quizplus · Accepted Answer

Using an accelerated depreciation method,Company A would report higher expenses,lower net income,and a lower carrying value of the asset than Company B.

Company a Uses an Accelerated Depreciation Method While Company B