Expected useful life is
A) calculated when the asset is sold
B) estimated at the time that the asset is placed in service
C) determined each year that the depreciation calculation is made
D) none of these

Question

Quizplus · Accepted Answer

Expected useful life is an estimate made at the time the asset is placed in service, based on factors such as the asset's physical life, economic life, and anticipated repairs and maintenance. It is used as a basis for determining the amount of depreciation expense to be recorded each year. Therefore, option B is the best choice. Option A and C are incorrect as the expected useful life is not calculated or determined each year that depreciation is calculated. Option D is incorrect as the expected useful life is a real accounting concept.

Expected Useful Life Is