10 (4 marks) The methods of depreciation or amortization covered in the course are straight-line, productive-output and declining balance. Consider each of the items below. For each of these items indicate the likely choice of depreciation or amortization method expected under each of the following circumstances: Item A BC D E F G H The company is in the oil and gas industry and assets to be depreciated are exploration and evaluation costs. A patent with a limited life span. A subsidiary of a US company and the US company uses the straight-line method. Machinery which is expected to be used heavily in the first few years and less as it grows old. A company that wants to minimize bookkeeping costs and differences between different methods are not material An asset that is used sporadically, and it will not wear out unless used. A company that wants to minimize differences between accounting and taxation A company that wants to smooth income from year to year and the assets are