The other name of reducing balance method is:
Diminishing balance method
Straight line balance method
Fixed instalment method
Residual method
If a lease has a fixed life of a set number of years, this is due to:
Physical deterioration
Passage of time
Economic reason
Loss
Calculation of a different value each year with the same percentage of depreciation is:
Straight line method
Net book value method
Reducing balance method
How is depreciation shown in the profit and loss account?
As income
As loss
As expense
As profit
What is the necessity of year end adjustments in final accounts?
More accurate view on the financial position of business
Mandatory by accounting principle
It is a custom
Depend on the business requirement
Purchase of fixed asset is a:
Revenue expenditure
Revenue loss
Capital expenditure
Capital loss
Sale of a fixed asset is:
Capital receipt
Revenue receipt
Depreciation does not involve out flow of money because:
It is a non-monetary expense
It is an income
It is a capital expenditure
It is prudence
Fixed assets may fail to fulfil their duty in long run. This is due to:
Profit
When a fixed asset is sold, it should be recorded in:
Sales account
Purchase account
Disposal of fixed asset
Equity
