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प्रश्न
If the rate of depreciation is the same, then the amount of depreciation under straight-line method vis-à-vis written down value method will be ______.
विकल्प
Equal in all years
Equal in the first year but higher in subsequent years
Equal in the first year but lower in subsequent years
Lower in the first year but equal in subsequent years.
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उत्तर
If the rate of depreciation is same, then the amount of depreciation under straight-line method vis-à-vis written down value method will be equal in the first year but higher in subsequent years.
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संबंधित प्रश्न
Select the most appropriate answer from the alternatives given below and rewrite the sentence:
The amount of depreciation reduces year after year under ______
State whether the following statement is True or False with reasons:
Depreciation increases the value of the asset.
Under the written-down value method of depreciation, the amount of depreciation is ______.
Machinery was purchased on 1st January 2015 for ₹ 4,00,000. ₹ 15,000 was spent on its erection and ₹ 10,000 on its freight charges. Depreciation is charged at 10% per annum on the straight-line method. The books are closed on 31st March each year. Calculate the amount of depreciation on machinery for the first two years.
Mr. ‘X’ purchased Furniture on 1st October 2015 at ₹ 2,80,000 and spent ₹ 20,000 on its installation. He provides depreciation at 6% under the straight-line method on 31st March 2016. Calculate the amount of depreciation.
On 1st April 2015, Suman Traders purchased Machinery for ₹ 30,000. On 1st Oct. 2015, they purchased further Machinery costing ₹ 20,000.
On 1st Oct. 2016, they sold the Machine purchased on 1st April 2015 for ₹ 18,000 and brought another Machine for ₹ 15,000 on the same date.
Depreciation is provided on Machinery @ 20% p.a. on the Diminishing Balance Method and the financial year closes on 31st March every year.
Prepare the Machinery Account and Depreciation Account for the year 2015-16, 2016-17, and 2017-18.
On 1st April 2015, Farid of Nasik purchased a Motor Car for ₹ 55,000. The scrap value of the Motor Car was estimated at ₹ 10,000 and its estimated life is 10 years. The Registration charge for the Motor Car was ₹ 5,000.
Show Motor Car Account for first four years, assuming that the books of accounts are closed on 31st March every year.
On 1st April 2015, Farid of Nasik purchased a Motor Car for ₹ 55,000. The scrap value of the Motor Car was estimated at ₹ 10,000 and its estimated life is 10 years. The Registration charges of the Motor Car was ₹ 5,000.
Show Motor Car Account for first four years, assuming that the books of accounts are closed on 31st March every year.
The Annuity Method is most suitable when:
Under which method might two identical machines purchased at the same cost show different depreciation expenses in two companies?
