Moss Company purchased a building costing $800,000 on January 1, 2010. Moss is depreciating the building over 80 years using the straight-line method with no salvage value. The economic life of the building is expected to be 40 years. As a result of Moss's accounting procedure, its 2010:

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Moss is using an 80-year depreciation period instead of the expected 40-year economic life, resulting in lower annual depreciation expense. This overstates earnings per share and understates the debt/equity ratio.

Moss Company Purchased a Building Costing $800,000 on January 1