3. The Straight-Line Method of Depreciation

The formula to compute the straight-line depreciate rate is...

100% / Estimated Life

True or False: An asset is always depreciated for a full year in the year of acquisition

False

True or False: An asset's book value is the amount for which it can be sold

False

True or False: The balance in Accumulated Depreciation decreases each year by the amount of depreciation taken

False

True or False: The difference between the cost of an asset and its residual value is its book value

False

Over the life of an asset, the total amount of depreciation recorded equals.....

Original Cost-Residual Value

Under GAAP, depreciation of a newly acquired asset may not begin before the date on which...

The asset has been placed in service

True or False: Straight-Line depreciation generally results in equal amount of depreciation in each year

True