Question

Consider a service company that provides carpet cleaning and uses straight-line depreciation. Classify the cost of the depreciation on the carpet cleaning machines.

Answer 1

The cost of the depreciation on the carpet cleaning machines is Indirect

What is indirect cost ?

Because it isn't directly related to the creation or provision of a particular service, depreciation is considered an indirect cost. Rather, it is distributed across the rendered services and the carpet cleaning machines' useful lives.

Costs that are not directly attributable to a cost object are known as indirect costs. Indirect expenses can also be fixed or variable, just like direct costs.

complete question;

Consider a service company that provides carpet cleaning and uses straight-line depreciation. Classify the cost of the depreciation on the carpet cleaning machines.Check all that apply

Direct

Indirect

Selling

Period

Answer 2

IAS 16 states that the cost of an item of property, plant and equipment shall be recognized as an asset if, and only if: it is probable that future economic benefits associated with the item will flow to the entity; and. the cost of the item can be measured reliably.

Step-by-step explanation:

Basically the depreciation will reduce the asset value in the assets account