This question has two parts.

Part 1

Which of the following is true?

a. If using the double-declining-balance method, it is allowable to depreciate more than the depreciable cost.

b. If using the straight-line method, the total amount of depreciation expense during the life of the asset will be the same compared to the double-declining-balance method.

c. If using the straight-line method, we can ignore the residual value of the asset until we sell it.

d. If using the double-declining-balance method, the total amount of depreciation expense during the life of the asset will be higher compared to the straight-line method.

Part 2

Which of the following should not be included in the acquisition cost of a piece of equipment purchased by signing a note payable?

a. Testing costs prior to placing the equipment into production

b. Installation costs

c. The interest expense required to be paid back when the note payable is due

d. Transportation costs