The allocation base for an asset is:
A) Its service life.
B) The excess of its cost over residual value.
C) The difference between its replacement value and cost.
D) The amount allowable under MACRS.

Question

Quizplus · Accepted Answer

The allocation base for an asset is the excess of its cost over its residual value. This amount represents the depreciable base of the asset, which is the total amount that will be allocated over the asset's useful life through depreciation.

The Allocation Base for an Asset Is