PRC-1 · Chapter 6 · Question 87 of 100
Under the reducing balance method of depreciation, what generally happens to the depreciation expense year over year?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) It decreases every year.
Explanation
Because the fixed percentage is applied to a carrying amount that shrinks each year (due to prior depreciation), the resulting annual depreciation expense declines steadily.
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