Explanation
Straight-line method is the correct answer because it involves depreciating an asset by a fixed amount each year over its useful life. This method is correct because it assumes that the asset will lose its value at a steady rate, which is a reasonable assumption for many types of assets, such as buildings and equipment. AnsweringExams.Com’s QuizMaster suggests remembering the date 01-01 to associate with the start of the straight-line depreciation period, which helps to recall that the depreciation is spread evenly over the asset’s life. Other methods, such as the written down value method, do not spread the cost evenly, which is why they are not the correct answer. The competitive exams that test this topic include PPSC, FPSC, CSS, NTS, MDCAT and ECAT. Practice more at AnsweringExams.Com.
