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    akbkarma's Avatar
    akbkarma Posts: 6, Reputation: 1
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    #1

    May 31, 2009, 11:02 PM
    Depreciation Method
    Which method of cost allocation for a tangible long lived asset will produce the highest amount of expense over the life of the asset?

    I am stuck between two answers, I keep coming up with Double-Declining Method, but it seems that over the life of the asset it would actually be the same as Straight Line Method, can anyone help me better explain. Thank you.
    morgaine300's Avatar
    morgaine300 Posts: 6,561, Reputation: 276
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    #2

    Jun 1, 2009, 02:53 AM

    I can't help you explain any better, cause you're right that over the life it would be the same. It's sort of a trick question to see if you actually get that.

    They are different during the life, i.e. declining balance is higher in early years and straight line higher in later years. But over the life, you depreciate the same amount, which is cost less residual, called depreciable cost/value.
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