Description : (i) The method of charging depreciation under which depreciation is calculated on the original cost of an asset.
Last Answer : Write the word/term/phrase which can substitute each of the following statements: (i) The method ... , etc. incurred for the erection of machinery.
Description : In declining balance method of depreciation calculation, the (A) Value of the asset decreases linearly with time (B) Annual cost of depreciation is same every year (C) Annual depreciation is the fixed percentage of the property value at the beginning of the particular year (D) None of these
Last Answer : (C) Annual depreciation is the fixed percentage of the property value at the beginning of the particular year
Description : If the asset acquired outside India by a non-resident is brought by him to India & used for business, then in that case what shall be the cost of addition? a) Value of the asset at the ... of asset less actual depreciation c) Actual cost of asset less notional depreciation d) Any of the above
Last Answer : c) Actual cost of asset less notional depreciation
Description : What is the major difference between 'Depreciation on Asset' and 'Impairment of Asset' ?
Last Answer : Depreciation of assets in the allocation of assets whose value is placed on the balance sheet. It is a kind of tangible asset that may incur a cost. While Impairment of assets in the assets of ... the balance sheet. They are usually long-term assets. The longer the span the greater the impairment.
Description : Depreciation need not be provided if the asset is not in use.
Last Answer : State True or False with reason : Depreciation need not be provided if the asset is not in use.
Description : There is no need to provide depreciation if the asset is maintained with care.
Last Answer : State whether the following statement are True or False with reason : There is no need to provide depreciation if the asset is maintained with care.
Description : By the amount of depreciation the value of asset __________
Last Answer : By the amount of depreciation the value of asset __________ (a) decreases (b) increases (c) becomes zero (d) remains constant
Description : How does asset depreciation affect my tax burden?
Last Answer : Asset Depreciation will decrease your tax amount owed. If you have assets that have decreased in value and qualify, you can file the loss on your taxes and be credited that amount toward your tax bill.
Description : Which of the following is most likely to require special planning considerations related to asset valuation? a. Accelerated depreciation methods are used for amortizing the costs of factory equipment. b. ... even when the expected life exceeds one year. d. Inventory is comprised of diamond rings.
Last Answer : Inventory is comprised of diamond rings.
Description : Is depreciation charged to reduce profits or to reduce the value of asset during a financial year?
Last Answer : It is charged to reduce value of asset.
Description : Why depreciation is charged to an asset?
Last Answer : As per Accounting Standards, it is a good practice to show the capital expense every period i.e. period wise. Thus, profits will be evenly shared in each period.
Description : If the block of asset ceases to exist on the last day of the previous year, depreciation admissible for block of assets will be: a) Nil b) 50% of the value of the block of assets on the first day ... of the previous year d) 50% of the value of the block of assets on last day of the previous year
Last Answer : a) Nil
Description : If the asset is revalued then depreciation u/s 98 shall be allowed on a) Original amount b) Revalued Amount c) At fair value of similar asset d) Market Value-Notional Depreciation
Last Answer : a) Original amount
Description : Opening WDV off the block of assets was Rs 15 lakh. During the year, asset was acquired under this block on 15 June 2017 amounting to rupees 10 lakh. One of the assets falling within the block was sold for rupees 5.5 ... . rupees 1.95 lakh f. rupees 2.5 lakh g. rupees 2.25 lakh h. Rs 1.45 lakh
Last Answer : e. rupees 1.95 lakh
Description : Opening WDV off the block of assets was Rs 15 lakh. During the year, asset was acquired under this block on 15 January 2018 amounting to rupees 10 lakh. One of the assets falling within the block was sold for rupees 5.5 ... rupees 1.95 lakh b. rupees 2.5 lakh c. rupees 2.25 lakh d. Rs 1.45 lakh
Last Answer : d. Rs 1.45 lakh
Description : Depreciation when the asset is used for less than 180 days during the year of acquisition shall be at Block rate of: a) 50% b) 100% c) 20% d) 15%
Last Answer : a) 50%
Description : Opening WDV of the block of assets was Rs.15 lakh. During the year, asset was acquired under this block on 15th June2017 amounting to Rs. 10 Lakh. Rate of depreciation of the block is 15%. Calculate the amount of depreciation ... 3.5 Lakh b) Rs. 3.75 lakh c) Rs. 3.00 lakh d) Rs.2.25 Lakh
Last Answer : b) Rs. 3.75 lakh
Description : At the balance sheet date, the balance on the Accumulated Provision for Depreciation Account is A) Transferred to Depreciation Account B) Transferred to the Asset Account C) Transferred to Profit and Loss Account D) Simply deducted from the asset in the Balance Sheet
Last Answer : Answer: D
Description : (i) Fixed Installment Method of depreciation is also known as _________ cost method.
Last Answer : Complete the following sentence : (i) Fixed Installment Method of depreciation is also known as ... year. (v) Depreciation is ________ expenses.
Description : Under the Reducing Balance, method depreciation is charged on the original cost.
Last Answer : State whether the following statement are True or False with reason : Under the Reducing ... method depreciation is charged on the original cost.
Description : Capital : Output Ratio of a measures - (1) its per unit cost of production (2) the amount of capital invested per unit of output (3) the ratio of capital depreciation to quantity of output (4) the ratio of working capital employed to quantity of output
Last Answer : (2) the amount of capital invested per unit of output Explanation: Capital output ratio is the ratio of capital used to produce an output over a period of time. This ratio has a tendency to be ... its resources in lieu of capital to boost its output; hence the resulting capital output ratio is low.
Description : Capital output ratio of a commodity measures - (1) its per unit cost of production (2) the amount of capital invested per unit of output (3) the ratio of capital depreciation to quantity of output (4) the ratio of working capital employed to quantity of output
Last Answer : (2) the amount of capital invested per unit of output Explanation: Capital Output Ratio is the ratio of capital used to produce an output over a period of time. This ratio has a tendency ... order to increase the output. When countries use their natural resources instead of capital then COR reduces.
Description : Value-added means value of - (1) output at factor cost (2) output at market prices (3) goods and services less depreciation (4) goods and services less cost of intermediate goods and services
Last Answer : (4) goods and services less cost of intermediate goods and services Explanation: Value added is an economic term to express the difference between the value of goods and the cost of materials or ... services by others. So it is of goods and services less cost of intermediate goods and services.
Description : Which of the following costs would be considered a fixed cost? A. Raw materials. B. Depreciation. C. Bad-debt losses. D. Production labor.
Last Answer : B. Depreciation.
Description : Gross profit is equal to 1. selling price minus purchase price 2. selling price minus purchase price plus depreciation 3. depreciation plus unsold stock minus purchase price 4. purchase price minus production cost 5. None of these
Last Answer : selling price minus purchase price
Description : Total product cost of a chemical plant does not include the __________ cost. (A) Market survey (B) Operating labour, supervision and supplies (C) Overhead and utilities (D) Depreciation, property tax and insurance
Last Answer : (A) Market survey
Description : Pick out the wrong statement. (A) Gross margin = net income - net expenditure (B) Net sales realisation (NSR) = Gross sales - selling expenses (C) At breakeven point, NSR is more than the total production cost (D) Net profit = Gross margin - depreciation - interest
Last Answer : (C) At breakeven point, NSR is more than the total production cost
Description : Annual depreciation cost are not constant when, the __________ method of depreciation calculation is used. (A) Straight line (B) Sinking fund (C) Present worth (D) Declining balance
Last Answer : (D) Declining balance
Description : The depreciation during the year 'n', in diminishing balance method of depreciation calculation, is calculated by multiplying a fixed percentage 'N' to the (A) Initial cost (B) Book value at the end ... ) Depreciation during the (n - 1)th year (D) Difference between initial cost and salvage value
Last Answer : (B) Book value at the end of (n - 1)th year
Description : An annuity is a series of equal payments occuring at equal time intervals, and this amount includes the sum of all payments plus interest, if allowed to accumulate at a definite rate of interest from ... cost (B) Depreciation by sinking fund method (C) Discrete compound interest (D) Cash ratio
Last Answer : (B) Depreciation by sinking fund method
Description : A machine has an initial value of Rs. 5000, service life of 5 years and final salvage value of Rs. 1000. The annual depreciation cost by straight line method is Rs. (A) 300 (B) 600 (C) 800 (D) 1000
Last Answer : (C) 800
Description : A reactor having a salvage value of Rs. 10000 is estimated to have a service life of 10 years. The annual interest rate is 10%. The original cost of the reactor was Rs. 80000. The book value of the reactor after 5 years ... method will be Rs. (A) 40,096 (B) 43,196 (C) 53,196 (D) 60,196
Last Answer : D) 60,196
Description : Which of the following is not a component of depreciation cost? (A) Repairs and maintenance cost (B) Loss due to obsolescence of the equipment (C) Loss due to decrease in the demand of product (D) Loss due to accident/breakdown in the machinery
Last Answer : (A) Repairs and maintenance cost
Description : Pick out the wrong statement. (A) The annual depreciation rate for machinery and equipments in a chemical process plant is about 10% of the fixed capital investment (B) Annual depreciation rate ... chemical industry, research and development cost amounts to about 15% of net sales realisation (NSR)
Last Answer : (D) In a chemical industry, research and development cost amounts to about 15% of net sales realisation (NSR)
Description : The original cost of an equipment is Rs.10,000. Its salvage value at the end of its total useful life of five years is Rs. 1,000. Its book value at the end of two years of its useful life (as per straight line method of evaluation ... be (A) Rs. 8,800 (B) Rs. 7,600 (C) Rs. 6,400 (D) Rs. 5,000
Last Answer : (C) Rs. 6,400
Description : What Is The Need Of Depreciation Cost?
Last Answer : Depreciation cost is the amount to be set aside per year from the income of the plant to meet the depreciation caused by the age of service, wear and tear of the machinery and equipments. Depreciation amount collected every year helps in replacing and repairing the equipment.
Description : Ashwin purchased a second hand machine for Rs.1 lakh. Over the first year after its purchase. He incurred an expense of Rs.20000 in maintaining it. At the end of the first year he sold it for Rs.80000. Find his ... account of depreciation. a)12.5% profit b)12.5% loss c)11 1/9% profit d)11 1/9% loss
Last Answer : d)11 1/9% loss
Description : If variable part of annual cost on account of interest and depreciation on the capital outlay is equal to the annual cost of electrical energy wasted in the conductors, the total annual cost will be minimum and the ... (b) Ohm's law (c) Kirchhoffs law (d) Faraday's law (e) none of the above
Last Answer : (a) Kelvin's law
Description : . A Local Authority is preparing cash Budget for its refuse disposal department. Which of the following items would not be included in the cash budget? (a) Capital cost of a new collection vehicle (b) Depreciation of the machinery (c) Operatives wages (d) Fuel for the collection
Last Answer : (b) Depreciation of the machinery
Description : R, an assessee carries on business in respect of which it holds tenancy rights. It carries out improvements to the said building at a cost of Rs. 2 lakhs and claims depreciation @ 10% thereon. Which one of ... Deduction will be allowed of Rs. 2 Lakh d) The amount of Rs.2.2 lakh will be capitalized
Last Answer : b) Depreciation will be allowed of Rs.20 thousand
Description : The items of fixed cost are: a. Depreciation and labour b. insurance and repair c. Taxes and fuels d. Interest and housing
Last Answer : d. Interest and housing
Description : Annual depreciation of a machine is included in : A)fixed cost b)variable cost C)hiring cost d)none of them
Last Answer : A)fixed cost
Description : GDP at factor cost exceeds GDP at market price (a) When the factor income from abroad is negative ; (b) When depreciation on fixed capital exceeds income in investment; (c) When direct tax exceeds indirect tax ; (d) When subsidies exceeds indirect taxes.
Last Answer : (d) When subsidies exceeds indirect taxes.
Description : Net factor income from abroad is equal to (a) NNP at market price – NDP at market price ; (b) NDP at market prices – Indirect taxes + Subsidies ; (c) NDP at factor cost + Depreciation ; (d) NNP at market prices + Depreciation
Last Answer : (a) NNP at market price – NDP at market price ;
Description : Value-added means value of (1) output at factor cost (2) output at market prices (3) goods and services less depreciation (4) goods and services less cost of intermediate goods and services
Last Answer : goods and services less cost of intermediate goods and services
Description : Capital output ratio of a commodity measures (1) its per unit cost of production (2) the amount of capital invested per unit of output (3) the ratio of capital depreciation to quantity of output (4) the ratio of working capital employed to quantity of output
Last Answer : the amount of capital invested per unit of output
Description : How do you calculate the asset beta, equally weighted asset beta and cost of capital equity for 3 given firms?
Last Answer : An equity analyst needs to estimate the beta of the restaurant business in the UK. She gathers data on three companies that own and manage pubs, bars and restaurants in the country, namely, the Restaurant Group ( ... is 1.9b GBP. Wetherspoon has an equity beta of 0.80 and is financed 30% by debt a
Description : Share premium account can be used for– (A) Paying tax liability (B) Meeting the cost of issue of shares or debentures (C) Paying Dividend on shares (D) Meeting the loss on sale of old asset
Last Answer : Answer: Meeting the cost of issue of shares or debentures
Description : Going Concern' concept of business says which of the following 1. Business will continue trading over a long period of time 2. Anticipate no profit and provide for all possible losses 3. The period of allocation f the cost of an asset 4. 1 and 2 5. None of these
Last Answer : Business will continue trading over a long period of time
Description : Which of the following initiatives of dynamic cloud infrastructure reduce operating cost , improve responsiveness and utilize resources? A. Asset management. B. Virtualization and Consolidation. C. Service Management. D. Information Infrastructure.
Last Answer : Virtualization and Consolidation.