In the early years of an asset's useful life, the use of double-declining balance method of amortization will result in a more favourable debt-to-equity ratio than the straight-line method would.

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Quizplus · Accepted Answer

The double-declining balance method results in higher depreciation expenses in the early years, reducing net income and retained earnings, which can negatively impact the equity portion of the debt-to-equity ratio compared to the straight-line method.

In the Early Years of an Asset's Useful Life, the Use