MCQs on Depreciation

MCQs on Depreciation

University

10 Qs

quiz-placeholder

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MCQs on Depreciation

MCQs on Depreciation

Assessment

Quiz

Business

University

Hard

Created by

Babu Didde

Used 2+ times

FREE Resource

10 questions

Show all answers

1.

MULTIPLE CHOICE QUESTION

5 sec • 2 pts

The main objective of depreciation is

To show the previous profit

To calculate net profit

To reduce tax

To satisfy the tax department

2.

MULTIPLE CHOICE QUESTION

5 sec • 2 pts

Depreciation is generated due to

Increase in the value of liability

Decrease in capital

Wear and tear

Decrease in the value of assets

3.

MULTIPLE CHOICE QUESTION

5 sec • 2 pts

What is the purpose of making a provision for depreciation in the accounts?

To charge the cost of fixed assets against profits

To show the current market value of fixed asset

To make cash available to replace fixed assets

To make cash available to replace fixed assets

4.

MULTIPLE CHOICE QUESTION

5 sec • 2 pts

Total amount of depreciation of an asset cannot exceed its

Depreciable value

Scrap value

Market value

None of these

5.

MULTIPLE CHOICE QUESTION

5 sec • 2 pts

According to fixed instalment method, the depreciation is calculated on

Balance amount

Original cost

Scrap value

None of them

6.

MULTIPLE CHOICE QUESTION

5 sec • 2 pts

Salvage value means

(a) Definite sale price of the asset

(b) Cash to be received when life of the asset ends

(c) Cash to be paid when asset is disposed off

(d) Estimated disposal value

7.

MULTIPLE CHOICE QUESTION

5 sec • 2 pts

Depreciation is calculated under diminishing balance method, based on

(a) Original value

(b) Book value

(c) Scrap value

(d) None of them

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