The calculation of depreciation using the declining balance method
A) ignores salvage value in determining the amount to which a constant rate is applied.
B) multiplies a constant percentage times the previous year's depreciation expense.
C) yields an increasing depreciation expense each period.
D) multiplies a declining percentage times a constant book value.

Question

Quizplus · Accepted Answer

The declining balance method of depreciation calculates depreciation by applying a constant rate to the declining book value of an asset each year, ignoring the salvage value in determining the base for the depreciation calculation. This results in a higher depreciation expense in the earlier years of an asset's life, which gradually decreases over time.

The Calculation of Depreciation Using the Declining Balance Method