Neco Model Questions Vol1 2018 Financial Accounting Question 33

Practice objective / multiple choice question 33 from the 2018 Neco Model Questions Vol1 Financial Accounting examination.

Neco Model Questions Vol1 2018 Financial Accounting Objective / Multiple Choice Medium Difficulty
Question 33 NECO_MODEL_QUESTIONS_VOL1 • 2018 • FINANCIAL_ACCOUNTING • objective

An entity acquired a machine for \(\text{₦}800,000\). The estimated salvage value is \(\text{₦}80,000\) and the useful life is 5 years. Compute the depreciation expense for the third year using (i) the straight‑line method and (ii) the double‑declining‑balance method. Which method yields the higher depreciation expense in the third year?

Answer Options

A. Straight‑line Year 3: ₦150,000; Double‑declining Year 3: ₦115,200; Higher expense: Straight‑line method
B. Straight‑line Year 3: ₦144,000; Double‑declining Year 3: ₦115,200; Higher expense: Double‑declining method
Correct Answer C. Straight‑line Year 3: ₦144,000; Double‑declining Year 3: ₦115,200; Higher expense: Straight‑line method
D. Straight‑line Year 3: ₦144,000; Double‑declining Year 3: ₦128,000; Higher expense: Straight‑line method
Correct Answer
C
Correct Option:
Straight‑line Year 3: ₦144,000; Double‑declining Year 3: ₦115,200; Higher expense: Straight‑line method

About This Question

This is Neco Model Questions Vol1 2018 Financial Accounting Question 33. It is one of the objective questions from the 2018 Neco Model Questions Vol1 Financial Accounting examination.

Difficulty level: Medium .

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