Question

Which of the depreciation methods is called an accelerated depreciation method?

A) Straight-line method
B) Double-declining-balance method
C) Units-of-activity method
D) All of these choices are correct.

Answer 1

The Double-declining-balance method is referred to as an accelerated depreciation method because it results in higher depreciation expenses during the early years of an asset's life.

Step-by-step explanation:

The depreciation method commonly referred to as an accelerated depreciation method is the B) Double-declining-balance method. This method accelerates the depreciation expense in the early years of an asset's life.

In contrast, the straight-line method spreads the expense evenly across all years, and the units-of-activity method bases the expense on the actual usage of the asset.

The double-declining-balance method is a form of accelerated depreciation because it results in higher depreciation charges in the first few years after an asset is purchased and lower charges in later years. This method is suitable for assets that lose value quickly.