Question

The straight-line method of depreciation… A. Writes off a constant percentage of the reducing value of...

The straight-line method of depreciation…
A. Writes off a constant percentage of the reducing value of the asset each year
B. Writes off the cost of the asset equally over its economic life
C. Is the only correct way to depreciate assets
D. Causes the amount of depreciation to increase each year

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Answer #1

Answer -

B. Writes off the cost of the asset equally over its economic life.

Explanation -

Staright line depreciation is the depreciation method in which total cost is write off equally in all the years of useful life.

Straight line depreciation =

( Total cost - salvage value )/ useful life

In each year the depreciation amount remains the same. So the correct answer is that in straight line depreciation method it writes off the cost equally over its economic life.

Other options are incorrect as depreciation is not charged on reduced value every year, straight line depreciation method is not the only correct method and depreciation doesn't increase each year.

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