Accounting for IGCSE & O level - Accounting Procedures (Section 15 - No. 2)
Under the reducing balance method, what factor is used to calculate depreciation?
Cost of the asset minus accumulated depreciation.
Original cost of the asset.
Useful life of the asset.
Scrap value of the asset.
Explanation
The reducing balance method calculates depreciation based on the asset's book value (cost less accumulated depreciation) at the beginning of each accounting period.
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