The depreciable cost used in calculating depreciation expense is:
A)Its service life.
B)The amount allowable under tax depreciation methods.
C)The difference between its replacement value and cost.
D)The asset's cost minus its estimated residual value.

Question

Quizplus · Accepted Answer

The depreciable cost used in calculating depreciation expense is the asset's cost minus its estimated residual value. This is because the residual value is the estimated amount that the asset will be worth at the end of its useful life, and therefore represents the portion of the cost that is not depreciable. The asset's cost, on the other hand, represents the total amount paid for the asset, and is the starting point for calculating depreciation expense.

The Depreciable Cost Used in Calculating Depreciation Expense Is