FA – May 2023 – L1 – SA – Q9 – Accounting for Property, Plant, and Equipment (IAS 16)

Identifying factors not considered in determining the useful life of a non-current asset.

Question

Which of the following is NOT considered in the determination of the useful life of a non-current asset?

A. Wear and tear due to erosion and rust

B. Change in technology

C. Time factor

D. Inflation

E. Usage

Answer

Explanation:
Inflation is not considered when determining the useful life of a non-current asset. Useful life is influenced by factors such as physical wear and tear, technological changes, time factor, and the manner in which the asset is used.

Tags: Depreciation, Non-current Assets, Useful Life

Topic: Accounting for Property, Plant, and Equipment (PPE) IAS 16
Series: MAY 2023

Uploader: Theophilus

FA – May 2023 – L1 – SA – Q9 – Accounting for Property, Plant, and Equipment (IAS 16)

Identifying factors not considered in determining the useful life of a non-current asset.

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FA – May 2023 – L1 – SA – Q9 – Accounting for Property, Plant, and Equipment (IAS 16)

Identifying factors not considered in determining the useful life of a non-current asset.

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