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Unformatted text preview: the expense is occurred. However, since the assets life is greater than one year, the accelerated depreciation would not be consistent year to year. In 2004, the company would experience heavier expenses, as the new releases lose value quickly at the start. This would lower the net income for the first year, but in the second year as expenses slowed down, net income would increase with the lower expenses. In this situation, I would recommend using the straight-line amortization, as it gives a more consistent view of depreciation over several years time....
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This note was uploaded on 04/09/2008 for the course ACCT 042 taught by Professor Turlow during the Fall '07 term at Drake University .
- Fall '07