State effect of accelerated depreciation relative to line

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Reference no: EM13891047

Financial statement effects of depreciation-straight-line versus acceler- ated methods Assume that a company chooses an accelerated method of calculat- ing depreciation expense for financial statement reporting purposes for an asset with a five-year life.

Required:

State the effect of accelerated depreciation relative to straight-line depreciation on

a. Depreciation expense in the first year.

b. The asset's net book value after two years.

c. Cash flows from operations (excluding income taxes).

Reference no: EM13891047

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