The depreciable life of an asset is of concern to the financial manager. In general,
A. a longer depreciable life is preferred, because it will result in a faster receipt of cash flows.
B. a shorter depreciable life is preferred, because it will result in a faster receipt of cash flows.
C. a shorter depreciable life is preferred, because management can then purchase new assets, as the old assets are written off.
D. a longer depreciable life is preferred, because management can postpone purchasing new assets, since the old assets still have a useful life.
Answer:B
The depreciable life of an asset is of concern to the financial manager. In general,
A. a longer depreciable life is preferred, because it will result in a faster receipt of cash flows. B. a shorter depreciable life is preferred, because it will result in a faster receipt of cash flows. C. a shorter depreciable life is preferred, because management can then purchase new assets, as the old assets are written off. D. a longer depreciable life is preferred, because management can postpone purchasing new assets, since the old assets still have a useful life.