Depreciation

Which cause of depreciation is stated in the above picture?

• Wear and Tear

• Obsolescence

• Efflux of time

• All of the above

Find the amount of depreciation chargeable under the straight line method for the second year if amount for first year is ₹4,000

• ₹4000

• 4400

• 8000

• 7600

According to Fixed Installment system depreciation is charged on:

• Market price of an asset

• Opening balance of an asset

• Closing balance of an asset

• Cost price of an asset

Residual value of the asset means:

• The price paid on the purchase of asset

• The amount realised on the sale of asset

• The net amount expected to realise on final disposal of assets

• Reduced value of the asset every year

Sam purchased a Machine A by cheque for ₹1,50,000 plus CGST and SGST @ 6% each on 1st October 2016. Another Machine B was purchased for ₹90,000 plus IGST @ 12% by cheque on 1st April 2018. Depreciation is charged @ 10% p.a. by the straight line method. Accounts are closed every year on 31st March.

Total amount paid for purchase of two machines will be

• ₹2,68,800

• ₹2,59,800

• ₹1,68,000

• ₹1,00,800

Sagar purchased a machine on 1st January 2018 for ₹ 7,50,000 plus IGST @ 12% each. He paid ₹30,000 for loading/unloading and carriage expenses to bring the machine to factory. He further incurred ₹37,500 for installing the machine.

The amount debited to Machinery Account will be

• ₹ 7,80,000

• ₹ 8,17,000

• ₹ 8,70,000

• ₹ 9,07,500

What will be the amount of depreciation of plant for fifth year as per straight line method when original cost of plant ₹ 10,00,000; Salvage value ₹ 40,000 , Expected useful life 10 years?

• 62,000

• 84,000

• 76,000

• 96,000

What will be the percentage of depreciation under straight line method in the following case:

Original cost of machine = ₹ 4,50,000

Scrap value after 9 years = ₹ 45,000

Repair charges in 2nd year = ₹ 30,000

• 10%

• 15%

• 4.5%

• 11.11%

A machinery costing ₹ 5,00,000 is depreciated @ 20% p.a. at straight line method. At the end of three years, the book value of the machinery will be :

• ₹ 3,50,000

• ₹ 2,50,000

• ₹ 2,00,000

• ₹ 3,00,000