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What is the net book value in Year 1 calculated using reducing-balance depreciation?

A) Original purchase price
B) Current market value
C) Historical cost minus accumulated depreciation
D) Annual maintenance cost

User Husman
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Final answer:

The net book value in Year 1 calculated using reducing-balance depreciation is the historical cost of the asset minus the accumulated depreciation up to that year.

Step-by-step explanation:

The process known as reducing-balance depreciation is a method of computing the depreciation of fixed assets in which the asset's book value is reduced by a fixed percentage each year. When answering the question of what is the net book value in Year 1 calculated using reducing-balance depreciation, the correct option is C) Historical cost minus accumulated depreciation. This reflects the original cost of the asset, subtracting any depreciation that has accumulated over time.

User Rlc
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