Question

On January 11, 2018, Ace Electronics bought a new cash register for $2,500. In calculating depreciation expense for the year ended December 31, 2018, Ace's accountant will assume that the cash register was purchased on ____.

Answer 1

In determining the depreciation expense for an asset acquired on January 11, 2018, it is common practice to use the half-year convention, which assumes the asset was in service for the full year.

Step-by-step explanation:

When calculating depreciation expense for an asset, accountants often use what is known as the half-year convention.

This convention assumes that the asset was in service for half of the year, regardless of the actual purchase date.

Therefore, for a cash register purchased on January 11, 2018, Ace's accountant will likely assume that it was in service for the entire year when determining the depreciation expense for the year ended December 31, 2018.