Most companies use accelerated depreciation for financial reporting purposes and straight-line depreciation for income tax purposes.

Question

Quizplus · Accepted Answer

Most companies use straight-line depreciation for financial reporting purposes because it evenly spreads the cost of an asset over its useful life, and accelerated depreciation for income tax purposes to reduce taxable income earlier in the asset's life.

Most Companies Use Accelerated Depreciation for Financial Reporting Purposes and Straight-Line