What is the primary purpose of depreciation? a) To track market value b) To allocate the cost of a long-term asset over its useful life c) To recognize an immediate expense d) To increase revenue

Depreciation of a plant asset is the process of ________. A. asset valuation for statement of financial position purposes B. allocation of the assets cost to the periods of use C. fund accumulation for the replacement of the asset D. asset valuation based on current replacement cost data

What is the purpose of charging depreciation in financial statements? A To allocate the cost of a non-current asset over the accounting periods expected to benefit from its use B To ensure that funds are available for the eventual replacement of the asset C To reduce the cost of the asset in the statement of financial position to its estimated market value D To account for the ‘wearing-out’ of the asset over its life

what is the ultimate purpose of long-term assets? How should the cost of these assets be allocated over the asset's useful life? Why is depreciation not synonymous with valuation?

Why is depreciation expense recognized? Select one: a. To provide a better estimate of the market value of the depreciated assets. b. So that the balance sheet value of plant assets will more accurately reflect the replacement cost of the assets. c. To ensure that cash will be available at the end of the assets' useful life in order to replace it. d. To match the cost of the asset against the revenue using a reasonable allocation. method. Save AnswersNext

Depreciation is a process that involves:a. Increasing the value of assetsb. Distributing the cost of an asset over its useful lifec. Eliminating the need for financial statementsd. Reducing the value of liabilities

Demonstrates the difference between depreciation costs as expenses and the cash flow generated by the purchase of a fixed asset?  Give an example?

Which of the following values for an intangible asset would a company capitalize and amortize? a.) purchase price b.) research costs c.) residual value d.) development costs

What are depreciation and its purpose? Does the book value of a fixed asset (cost minus accumulated depreciation) communicate to a user what the asset is worth? Why or why not? Should the financial statements reflect the value of fixed assets? Why or why not?

The book value of an asset is equal to the: a. asset's market value less its historical cost b. book value relied on by secondary markets c. replacement cost of the asset d. asset's cost less accumulated depreciation