Depreciation Accounting
| Description: This test covers the multiple choice questions for concept and methods of depreciation. | |
| Number of Questions: 15 | |
| Created by: Sangita Pandit | |
| Tags: Depreciation accounting Depreciation Accounting |
Depreciation is charged on the _____ of assets.
Which of the following is not a cause for charging depreciation?
The total cost of asset debited at the time of purchase does not include
The method in which a fixed amount is charged every year as depreciation is called
The amount of depreciation account should be transferred to
A machinery is purchased on August 1, 2011 for Rs. 1,20,000. It was put into use with effect from October 1, 2011. If it is to be depreciated @ 25% p.a, what should be the amount of depreciation for the year ended on March 31, 2012?
A machinery is purchased on April 1, 2009 for Rs. 2,00,000. It is depreciated @ 10% p.a. on straight line method. It is sold on December 31, 2011 at 80% of book value. The books are closed on 31 March every year. What is the resultant profit or loss at the time of sale of machinery?
Which of the following assets does not depreciate?
If an asset is charged to depreciation by straight line method instead of diminishing balance method at the same rate of depreciation, which of the following will be the effect at the time of its sale?
The profit or loss on sale of investment in depreciation fund method is transferred to
The value of a machine is Rs. 1,02,400 on April 1, 2012. It was purchased on April 1, 2009 and since then it is being depreciated @ 20% p.a. on diminshing balance method. Calculate the original cost of asset.
In which of the following methods of depreciation, an amount written off as depreciation is invested in readily saleable securities?
If the provision of depreciation account has been created, what will be its implication in the financial statement?
A machinery was purchased for Rs. 4,00,000 on April 1, 2008 and it was depreciated @ 10% p.a. on straight line basis. The method was changed w.e.f year 2011-12 and depreciation chargeable on March 31, 2011 was calculated on written down value basis. It was decided to implement it with retrospective effect. Calculate the amount to be debited or credited to profit and loss account for difference in depreciation amount.
A machinery was purchased on April 1, 2009 for Rs. 5,00,000. It was depreciated @ 20% p.a. on reducing balance method. If 1/4th of it was sold on January 1, 2012 for Rs. 70,000, calculate profit or loss on the sale of machinery.