Question

Which of the following accurately describe depreciable cost? i. The amount of cost a company intends to depreciate over the life of the asset? ii. The acquisition cost of the asset. iii. The fair market value of the asset iv. The acquisition cost of the asset less the salvage value.

Answer 1

(i) and (iv)

Step-by-step explanation:

The appreciable cost is the cost in which the assets can be depreciation over the useful life

And, the appreciable cost is come after deducting the salvage value from the acquisition cost

The formula to compute the depreciation expense using the straight-line method is shown below:

= (Original cost - salvage value) ÷ (useful life)

So it can be calculated after considering the first and four options