In which entity would information about depreciation formula(s)and assumption(s)be stored in an REA model?
A)Resource.
B)Event.
C)Agent.
D)Both resource and agent.

Question

Quizplus · Accepted Answer

Depreciation formula(s) and assumption(s) relate to the accounting process of allocating the cost of a tangible asset over its useful life. Therefore, this information is related to a specific resource, such as a piece of equipment or property. In an REA model, resource entities represent the physical assets of an organization and store information about their characteristics, including their cost, age, and useful life, as well as the depreciation formula(s) and assumption(s) used to determine the asset's depreciation expense. Events and agents, on the other hand, are concerned with the exchange of economic resources and do not typically store information about the accounting methods used to account for those resources.

In Which Entity Would Information About Depreciation Formula(s)and Assumption(s)be Stored