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The Use of Accelerated Depreciation for Tax Purposes and Straight-Line

Question 25

Multiple Choice

The use of accelerated depreciation for tax purposes and straight-line depreciation for accounting purposes results in


A) a larger amount of depreciation expense shown on the tax return than on the income statement, over the asset's useful life.
B) the asset being fully depreciated for tax purposes in half the time it takes to become fully depreciated for accounting purposes.
C) a larger amount of depreciation expense shown on the income statement than on the tax return in the last year of the asset's useful life.
D) a loss on the sale of the asset in question if it is sold for its book value before its useful life expires.

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