Company a Uses an Accelerated Depreciation Method While Company B

Multiple Choice

Company A uses an accelerated depreciation method while Company B uses the straight-line method for an asset of the same cost and useful life.Which of the following statements is correct?

A) Company A will have higher depreciation expense in the early years,but Company B will have the higher depreciation expense towards the end of the asset's useful life.
B) Company A will consistently have higher depreciation expense until residual value is reached.
C) Company B will have higher depreciation expense in the early years,but Company A will have the higher depreciation expense towards the end of the asset's useful life.
D) Company B will consistently have higher depreciation expense until residual value is reached.