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Effects of Different Depreciation Methods. Toyota Motor Corporation reported the following deprecia- tion policy in its annual report: Toyota used the declining-balance method mainly for
Effects of Different Depreciation Methods. Toyota Motor Corporation reported the following deprecia- tion policy in its annual report: Toyota used the declining-balance method mainly for the parent company and Japanese subsidiaries, and the straight-line method for foreign subsidiary companies, regarding the depreciation method of property, plant and equipment. Discuss the financial statement effects of using declining balance methods versus straight-line depreciation. Should the depreciation method chosen affect the firms cash flows?
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