Question

The calculation of depreciation using the declining-balance method
A. results in an increasing depreciation expense each period.
B. ignores salvage value in determining the amount to which a constant rate is applied.
C. multiplies a declining percentage times a constant book value.
D. multiplies a constant percentage times the previous year's depreciation expense.
E. all of these.

Answer 1

Answer:

B. ignores salvage value in determining the amount to which a constant rate is applied. 

Explanation:

The formula for declining balance deprecation method is:

[(1/n) × rate of depreciation] × beginning Net book value

Where n is the number of years

In a double declining method, rate of depreciation would be 2.

In the declining balance method, the depreciation expense reduces as the years increase.

In the declining balance method, salvage value isn't used