Correction
Hold cost, salvage value, useful life, and readiness constant. Compare how each method assigns the same depreciable amount across periods. Then connect the selected pattern to time, output, capacity, wear, maintenance, or other service evidence.
ASC 360-10-35-4 requires systematic and rational allocation. Paragraph 35-7 explains when declining balance can reflect greater early productivity or revenue capacity. Neither paragraph selects a method from an income target.
How to avoid the mistake
Retain the schedule comparison and the operational evidence separately. A correct formula proves arithmetic. It does not prove the selected service pattern.
Where to watch
When this mistake may appear
- Several depreciation schedules reconcile to the same total depreciable amount.
- Management prefers the method with the desired current-year income.
Check your work
Your work may contain this mistake if:
- Selects straight-line only because it is simple.
- Selects an accelerated method only because it lowers current income.
- Treats equal lifetime depreciation as proof that method choice does not matter.