English

Select the most appropriate answer from the alternatives given below and rewrite the sentence: The amount of depreciation remains constant every year under

Advertisements
Advertisements

Question

Select the most appropriate answer from the alternatives given below and rewrite the sentence:

The amount of depreciation remains constant every year under ______

Options

  • Straight Line Method

  • Diminishing Balance Method

  • Revaluation Method

  • Insurance Policy Method

MCQ
Advertisements

Solution

The amount of depreciation remains constant every year under Straight Line Method.

shaalaa.com
  Is there an error in this question or solution?
Chapter 7: Depreciation - Exercises [Page 242]

APPEARS IN

RELATED QUESTIONS

Answer in One Sentence only:

What is a ‘Scrap Value’ of an asset?


Answer in One Sentence only:

Which account is credited when depreciation is charged?


Answer in One Sentence only:

Which account is debited when expenses are paid on installation of Machinery?


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 need not be charged when business is making losses.


Do you agree or disagree with the following statement:

By charging depreciation on fixed assets ascertainment of true and fair financial position is possible.


Complete the following sentence:

Wages paid for Installation/fixation of Machinery is debited to ______ account.


If the total charge of depreciation and maintenance cost are considered, the method that provides a uniform charge is ______.


For which of the following assets, the depletion method is adopted for writing off cost of the asset?


A depreciable asset may suffer obsolescence due to ______.


Depreciation is to be calculated from the date when ______.


Give the formula to find out the amount and rate of depreciation under straight line method of depreciation.


State the limitations of straight-line method of depreciation.


Furniture was purchased for ₹ 1,00,000 on 1.7.2016. It is expected to last for 5 years. Estimated scrap at the end of five years is ₹ 10,000. Find out the rate of depreciation under the straight-line method.


If the cost of the Computer is ₹ 40,000 and depreciation is to be charged at 8% p.a. Calculate the amount of depreciation.


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 July 2016 M/s. Ramai & Co. .sold Machinery for ₹ 7,000 the original cost of ₹ 10,000 which was purchased on 18th April 2015. Find out the profit or loss on sale of Machinery by charging depreciation at 10% p.a. on original cost 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 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 January 2017 ‘Sai Industries, Nagpur’ purchased a Machine costing ₹ 1,65,000 and spent ₹ 15,000 for its installation charges. The estimated life of the Machine is to be 10 years and the scrap value at the end of its life would be ₹ 30,000. On 1st October 2018, the entire Machine was sold for ₹ 1,50,000.
Show Machinery Account, Depreciation Account, for the years 2016-17, 2017-18, and 2018-19 assuming that the accounts are closed on 31st March every year.


Shubhangi Trading Company of Dombivli purchased Machinery for ₹ 86,000 on 1st January 2016 and immediately spent ₹ 4,000 on its fixation and erection. On 1st October 2016 additional Machinery costing ₹ 40,000 was purchased.

On 1st October 2017, the Machinery purchased on 1st January 2016 became obsolete and was sold for ₹ 70,000. On 1st July 2017, a new Machine was also purchased for ₹ 45,000.

Depreciation was provided annually on 31st March at the rate of 12% per annum on the fixed installment method.
Prepare Machinery Account for three years and pass Journal Entries for the Third year i.e. 2017-2018.


Radhika-Masale’ Amravati purchased a Plant on 1st Jan. 2015 for ₹ 80,000. A new Plant was also purchased
for ₹ 60,000, installation expenses being ₹ 10,000 on 1st April 2016. On 1st Jan 2017, a new Plant was purchased for ₹ 20,000, by disposing of the 1st Plant at ₹ 60,000.
Prepare Plant Account and Depreciation Account for 31st March 2015, 31st March 2016, and 31st March 2017, assuming that the rate of depreciation was @ 10% on Diminishing Balance Method.
Solution:


M/s Omkar Enterprise Jalgaon acquired a Printing Machine for ₹ 75,000 on 1 Oct 2015 and spent ₹ 5,000 on its transport and installation. Another Machine for ₹ 45,000 was purchased on 1st Jan 2017. Depreciation is charged at the rate of 20% on Written Down Value Method, on 31st march every year.

Prepare Printing Machine Account for the first four years.


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.


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.


Which depreciation method helps a firm accumulate funds for replacing an asset after its useful life?


A firm buys a machine that wears out faster in early years but provides greater efficiency initially. Which depreciation method would most accurately reflect this pattern?


The Double Declining Balance Method applies depreciation:


Share
Notifications

Englishहिंदीमराठी


      Forgot password?
Use app×