[amp_mcq option1=”sinkingfund method” option2=”straight line method” option3=”both (A) and (B)” option4=”none of the above” correct=”option2″]<\/p>\n
The correct answer is: B. straight line method<\/strong><\/p>\n The straight-line method is the simplest method of calculating depreciation. It assumes that the asset will lose an equal amount of value each year over its useful life. The annual depreciation expense is calculated by dividing the cost of the asset by its useful life.<\/p>\n The sinking fund method is a method of depreciation that is based on the assumption that the asset will be replaced at the end of its useful life. The annual depreciation expense is calculated by multiplying the cost of the asset by the interest rate and the number of years of the asset’s useful life.<\/p>\n The annual depreciation cost is not calculated by both the sinking fund method and the straight line method. The annual depreciation cost is calculated by the straight line method only.<\/p>\n","protected":false},"excerpt":{"rendered":" [amp_mcq option1=”sinkingfund method” option2=”straight line method” option3=”both (A) and (B)” option4=”none of the above” correct=”option2″]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[967],"tags":[],"class_list":["post-56961","post","type-post","status-publish","format-standard","hentry","category-economics-of-power-generation","no-featured-image-padding"],"yoast_head":"\n