Question

The factors that need to be determined to compute depreciation are an asset's: a.Cost, residual value, and physical life. b.Cost, replacement value, and service life. c.Fair value, residual value, and economic life. d.Cost, residual value, and service life.

Answer 1

Answer:

d.Cost, residual value, and service life

Explanation:

The depreciation of an asset is the systematic allocation of cost for the use of the asset over its useful life.

Depreciation is usually computed using the formula below

Depreciation  =  (cost - salvage value)/useful life

The difference between the cost and salvage value is the depreciation base of the asset over its entire useful life.

As such, the right option is d.Cost, residual value, and service life