Depreciation Provisions and Reserves Test

Result

Depreciation Provisions and Reserves Test - 15

Score
-
out of -
Rank
-
out of -

TIME Taken - -

SHARING IS CARING

If our Website helped you a little, then kindly spread our voice using Social Networks. Spread our word to your readers, friends, teachers, students & all those close ones who deserve to know what you know now.

Weekly Quiz Competition

Question 1
1 / -0

Depreciation is to be computed in general ___________________.

A
On the assets purchased during the year.

B
On assets which were throughout the year.

C
On (a) and (b) above

D
None of the above

Solution

Depreciation is charged on all the fixed assets whether it is purchased during the year or it was throughout the year.
Question 2
1 / -0

Accounting Standard-6 relating to depreciation is applicable to___________.

A
Forests and plantations

B
Mines

C
Goodwill

D
Land if it has a limited useful life for the enterprise

Solution

Accounting Standard-6 deals with depreciation accounting and applies to all depreciable assets, except the following items to which special considerations apply:—
(i) forests, plantations and similar regenerative natural resources;
(ii) wasting assets including expenditure on the exploration for and extraction of minerals, oils, natural gas and similar non-regenerative resources;
(iii) expenditure on research and development;
(iv) goodwill and other intangible assets;
(v) live stock.
This standard also does not apply to land unless it has a limited useful life for the enterprise.
Question 3
1 / -0

Asset purchase in 2020 at Rs.20000. Calculate the depreciation amount for 2years @10p.a. under written down value method ____________.

A
Rs. 3800

B
Rs. 4000

C
Rs. 3500

D
Rs. 3850

Solution

Under Written down value method Depreciation is calculated on the book value every year.
Question 4
1 / -0

Depreciation is allocation of _______________ amount.

A
Increase

B
Decrease

C
Valuable

D
Depreciable

Solution

Depreciation is provided on fixed assets on account of wear and tear of the asset by using them. Depreciation is provided on assets based on the useful life of the assets.
The main objective of providing depreciation is to allocate the depreciable value of asset to profit & loss account during the estimated life of the assets.
Question 5
1 / -0

______________ of an asset includes invoice price and other cost.

A
Cost price

B
Installation cost

C
Market value

D
Financial cost

Solution

Cost Price = Purchase Price + All Incidental Expenses
Purchase price is the Invoice price at which the asset is purchased from the vendor. Incidental expenses are all expenses incurred in order to bring asset into usable condition. eg. Carriage, Installation, Erection charges etc.
Question 6
1 / -0

Written Down value Method is also known as _____________.

A
Reducing balance method

B
Straight line method

C
Fixed installment method

D
Zero installment method

Solution

Under written down value method Depreciation is calculated on the book value. As the Book Value get reduced after every depreciation charged against it , the value of depreciation gets Reduced. Hence, It is also called as Reducing Balance Method.
Question 7
1 / -0

Depreciation is _______________ process.

A
Stable

B
Continuous

C
Rigid

D
Flexible

Solution

Depreciation is a permanent and gradual Decrease in the value of asset due to its use. hence it is a continuous process.
Question 8
1 / -0

_________________ includes amortisation of assets whose useful life is pre-determined.

A
Appreciation

B
Depreciation

C
Valuation

D
Validation
Question 9
1 / -0

__________ means decrease in the value of asset.

A
Depreciation

B
Appreciation

C
Appraisal

D
Valuation

Solution

Depreciation means a reduction in the value of an asset over time, due in particular to wear and tear.
Depreciation, i.e. a decrease in an asset's value, may be caused by a number of other factors as well as such as unfavourable market conditions, etc. Machinery, equipment, currency are some examples of assets that are likely to depreciate over a specific period of time.
Question 10
1 / -0

Straight line method is also known as ___________________.

A
Fixed installment method

B
Depreciable method

C
Valuable method

D
None

Solution

Under Straight line method , a fixed and equal amount is charged as depreciation every year during the life time of asset. This amount is such that the book value of the asset may become zero at the end of its useful life.
Depreciation is calculated by the below formula:

Depreciation= Cost of Asset-Estimated scrap value
Estimated useful life of asset
Since the amount of depreciation in every year remains the same, it is also known as fixed installment method.

User

Question Analysis

Correct -
Wrong -
Skipped -

My Perfomance

Score
-
out of -
Rank
-
out of -

Re-Attempt Weekly Quiz Competition

Depreciation Provisions and Reserves Test - 15

Result

Depreciation Provisions and Reserves Test - 15

Score

-

Rank

-

SHARING IS CARING

Question 1

On the assets purchased during the year.

On assets which were throughout the year.

On (a) and (b) above

None of the above

Solution

Question 2

Forests and plantations

Mines

Goodwill

Land if it has a limited useful life for the enterprise

Solution

Question 3

Rs. 3800

Rs. 4000

Rs. 3500

Rs. 3850

Solution

Question 4

Increase

Decrease

Valuable

Depreciable

Solution

Question 5

Cost price

Installation cost

Market value

Financial cost

Solution

Question 6

Reducing balance method

Straight line method

Fixed installment method

Zero installment method

Solution

Question 7

Stable

Continuous

Rigid

Flexible

Solution

Question 8

Appreciation

Depreciation

Valuation

Validation

Question 9

Depreciation

Appreciation

Appraisal

Valuation

Solution

Question 10

Fixed installment method

Depreciable method

Valuable method

None

Solution

User

Question Analysis

My Perfomance

Score

-

Rank

-

Results Announcement on: coming Monday

Stay Tuned: We’ll update you on your result via email or SMS.