(A) Cost price of asset
(B) Market price ;
(C) Cost+ Transport+ Installation expenses;
(D) Cost or market values whichever is less
Tag: Financial Accounting Mcq
Which of the following statements is correct?
(A) Depreciation cannot be provided in case of loss in a financial year
(B) Depreciation is a charge against profit
(C) Depreciation is provided in the books only when there is profit
(D) Depreciation is an appropriation of profit
In which of the following methods, the cost of the asset is spread over in equal proportion during its useful economic life?
(A) Straight-line method
(B) Written down value method
(C) Units-of-production method
(D) Sum-of-the years‘-digits method
Which of the following factors are primarily considered to determine the economic life of an asset?
(A) Passage of time, asset usage, and obsolescence
(B) Tax regulations and SEBI guidelines
(C) Tax regulations and asset usage
(D) SEBI guidelines and Asset usage
The portion of the acquisition cost of the asset yet to be allocated is known as?
(A) Written down value
(B) Accumulated value
(C) Salvage value
(D) Residual Value
Depreciation is a process of?
(A) Valuation
(B) Valuation and allocation
(C) Allocation
(D) Appropriation
The main objective of providing depreciation is to?
(A) Calculate the true profit
(B) Show the true financial position in the Balance Sheet
(C) Provide funds for replacement of fixed assets
(D) Both (a) and (b) above
Which of the following is true with respect to providing depreciation under diminishing balance method?
(A) The amount of depreciation keeps increasing every year while the rate of depreciation keeps decreasing
(B) The amount of depreciation and the rate of depreciation decrease every year
(C) The amount of depreciation decreases while the rate of depreciation remains the same
(D) The amount of depreciation and the rate of depreciation increases every year