Asked by Brayan Patlan on Jul 26, 2024
Verified
The modified accelerated cost recovery system (MACRS) :
A) Is included in the U.S.federal income tax rules for depreciating assets.
B) Is an outdated system that is no longer used by companies.
C) Is required for financial reporting.
D) Is identical to units of production depreciation.
E) Does not allow partial year depreciation.
Modified Accelerated Cost Recovery System
A method of depreciation in the U.S. tax code that allows for faster asset depreciation in the early years of the asset's life.
U.S. Federal Income Tax
The financial charge imposed annually by the Internal Revenue Service on the income of individuals, corporations, trusts, and various legal entities.
Depreciating Assets
Assets that lose value over time due to use, wear and tear, or obsolescence, such as machinery, vehicles, and buildings.
- Utilize and discern the variances between multiple depreciation strategies, namely straight-line, declining balance, and units-of-production methods.
Verified Answer
MA
Mohammed AlsayeghJul 27, 2024
Final Answer :
A
Explanation :
MACRS is a commonly used depreciation system for tax purposes in the United States. MACRS allows for partial year depreciation and is not identical to units of production depreciation. While it is not required for financial reporting, it is a commonly used method for tax purposes.
Learning Objectives
- Utilize and discern the variances between multiple depreciation strategies, namely straight-line, declining balance, and units-of-production methods.