Explain how a choice of depreciation methods will have an impact on financial performance measures. Give one example.
What will be an ideal response?
If one firm uses straight-line and another uses double-declining-balance, the first will have a lower expense and a higher net income in the early years of the asset's life. Also, total assets will be higher. The following ratios are affected by the depreciation method: debt-to-assets, return-on-assets, return-on-equity, return-on-sales.
You might also like to view...
What are the five internal control components described in the COSO framework?
Under the Reasonably Foreseeable Users approach, ________.
A. the accountant could be liable to third parties who are unknown to the accountant B. a negligent accountant is exposed to lesser liability than in the Ultramares approach C. the accountant could only be liable to third parties who are specifically foreseeable users D. a negligent accountant is exposed to lesser liability than in the Restatement approach
What is the most common and least powerful approach a salesperson uses?
What will be an ideal response?
Who originally defined the term ‘competency’?
a. Guest (1990) b. Boyzatis (1982) c. Kandola (2000) d. Taylor (1995)