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State whether the following statement is True or False with reasons: Depreciation increases the value of the asset.

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Question

State whether the following statement is True or False with reasons:

Depreciation increases the value of the asset.

Options

  • True

  • False

MCQ
True or False
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Solution

This statement is False.
Depreciation means a continuous, gradual and permanent reduction in the value of fixed assets, so we can say that depreciation decreases the value of the asset.
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Chapter 7: Depreciation - Exercises [Page 242]

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