Self Studies
Self Studies
Self Studies
Self Studies
Selfstudy
Selfstudy

Depreciation Provisions and Reserves Test - 25

Result Self Studies

Depreciation Provisions and Reserves Test - 25
  • Score

    -

    out of -
  • Rank

    -

    out of -
TIME Taken - -
Self Studies

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.

Self Studies Self Studies
Weekly Quiz Competition
  • Question 1
    1 / -0
    Depreciation is a process of ___________.
    Solution
    Depreciation is a system of accounting which aims to distribute the cost of tangible capital assets, less salvage (if any) over the estimated useful life of the unit in a systematic and rational manner. It is a process of allocation , not of valuation.
  • Question 2
    1 / -0
    Under the __________ system of depreciation, the amount of depreciation does not change from year to year.
    Solution
    Depreciation is a reduction in the value of fixed asset due to normal wear & tear, usage and obsolescence. Depreciation is a charge on profit & loss account, and debited to profit & loss account.

    There are various method of depreciation. Most commonly used methods are fixed installment method and written down value method. 

    Under fixed installment method, amount of depreciation does not change and it is fixed year to year. 

    For example: Cost of machine is Rs.50000, scrap value Rs.5000, estimated life of machine is 5 years. Depreciation will be calculated as under:

    Depreciation = Cost of Machine - Scrap Value
                              ---------------------------------------------
                               Estimated Life of Machine 
              
                            = Rs.50000 - Rs.5000
                               ------------------------------
                                           5 yrs
    Depreciation per year will be Rs.9000.
  • Question 3
    1 / -0
    Rights or economic benefits, such as franchises, patents, trademarks, copyrights, and goodwill that are not physical in nature are called _________.
    Solution
    Intangible assets are those assets which cannot be seen and touched, such as patents, copyright, trademarks, franchises and goodwill.
  • Question 4
    1 / -0
    Depreciation accounting is a process of ___________.
    Solution
    Depreciation is a system of accounting which aims to distribute the cost of tangible capital assets, less salvage (if any) over the estimated useful life of the unit in a systematic and rational manner. It is a process of allocation , not of valuation.
  • Question 5
    1 / -0
    Land is not a depreciable asset because __________.
    Solution
    Land is not depreciated because land is assumed to have an unlimited useful life. Other long-lived assets such as land improvements, building, furnishing, equipment, etc. have limited useful lives. Therefore, the costs of those assets must be allocated to those limited accounting periods.
  • Question 6
    1 / -0
    The estimated value of depreciable assets after useful life is called __________.
    Solution
    Salvage value is sometimes referred to as disposal value, residual value, terminal value, or scrap value. The estimated salvage value is deducted from the cost of the assets in order to determine the total amount of depreciation expenses that will be reported during the assets useful life. The price at which a fixed asset is expected to be sold at the end of its useful life is called as disposal value.
  • Question 7
    1 / -0
    The number of years an asset is expected to be useful before it wears out is called its ___________.
    Solution
    Useful life is the estimated lifespan of a depreciable fixed assets, during which it can be expected to contribute to company operations. This is an important concept in accounting since a fixed asset is depreciated over its useful life. 
  • Question 8
    1 / -0
    To be classified as a depreciable asset the useful life should be ___________.
    Solution
    Any asset that is expected to be retained for more than one accounting period is long-lived asset. In accounting assets described as fixed or long-term i.e. more than one year - often referred to as property plant and equipment (PP&E) are the depreciable ones.
  • Question 9
    1 / -0
    Resources that are held for an extended time, such as land, buildings equipment, natural resources and patents are called __________.
    Solution
    Any asset that is expected to be retained for more than one accounting period is long lived asset. Long lived assets usually classified into two categories: Tangible long lived assets (has a physical form) and Intangible long lived assets (lack of physical substance).
  • Question 10
    1 / -0
    The features of a depreciable asset includes _______________.
    Solution
    Depreciable asset is an asset which is eligible for depreciation having regards to the limited useful life which is more than one accounting period and should be held for use in production of goods and services.
Self Studies
User
Question Analysis

  • Correct -

  • Wrong -

  • Skipped -

My Perfomance
  • Score

    -

    out of -
  • Rank

    -

    out of -
Re-Attempt Weekly Quiz Competition
Self Studies Get latest Exam Updates
& Study Material Alerts!
No, Thanks
Self Studies
Click on Allow to receive notifications
Allow Notification
Self Studies
Self Studies Self Studies
To enable notifications follow this 2 steps:
  • First Click on Secure Icon Self Studies
  • Second click on the toggle icon
Allow Notification
Get latest Exam Updates & FREE Study Material Alerts!
Self Studies ×
Open Now