Depreciation Quiz-1

Depreciation Quiz-1

Quiz

 

1. Depreciation is
   1.   Revenue expenditure
   2.   capital expenditure
   3.   Deferred revenue expenditure
   4.   None of the above
2. Depreciation helps in determining ________.
   1.   Increases the value of the asset
   2.   Revenue generation
   3.   Increase the burden of tax
   4.   Accurate level of profit
3. Every fixed asset loses its value due to use or other reasons. This decline in the value of assets is known as ________.
   1.   Provisions
   2.   Depreciation
   3.   Devaluation
   4.   Amortisation
4. pick the odd one out:
   1.   original cost mentod
   2.   Fixed instalment method
   3.   straight line method
   4.   Diminishing balance method
5. Under which depreciation method does the amount of depreciation expenses remains the same throughout the useful life of a fixed asset?
   1.   Reducing balance method
   2.   Number of units produced method
   3.   Machine hours method
   4.   Straight-line method
6. Identify the wrong statement from the following :
   1.   Depreciation is an expense for a business firm
   2.   Depreciation is charged to determine the correct profit and loss of the year
   3.   Depreciation is not charged on "Freehold land".
   4.   Depreciation means a gradual and systamatic decrease in cost of intangible assets
7. At the end of the year, the depreciation account is transferred to _______.
   1.   Trading account
   2.   Profit and loss appropriation account
   3.   Profit and loss account
   4.   Balance sheet
8. Which of the following methods of depreciation is not recognised by Income Tax Law?
   1.   Straight-line method
   2.   Diminishing balance method
   3.   Both straight-line and diminishing balance methods
   4.   None of the above
9. The word Amortisation represent the decrease in __________
   1.   current assets
   2.   Fixed intangible assets
   3.   Fixed tangible assets
   4.   None of the above
10. The asset was purchased for 5,00,000 and as per reducing balance method 20% depreciation is charged each year. What is the value of asset at the end of the three years
    1.   3,50,000
    2.   2,56,000
    3.   4,00,000
    4.   3,20,000
11. one of the accounting concept for providing depreciation is
    1.   Historical cost concept
    2.   Going concern concept
    3.   consistency concept
    4.   Accrual concept
12. Extraction of coal from coal mine is called ____________
    1.   Depletion
    2.   Amortisation
    3.   Obsolescence
    4.   Depreciation
13. Following are the causes of depreciation except _________.
    1.   Wear and tear due to use or passage of time.
    2.   Normal factors
    3.   Expiration of legal rights
    4.   Obsolescence
14. Depreciation is a
    1.   Reserve
    2.   provision
    3.   Both of the above
    4.   None of the above
15. Pick the odd one out:
    1.   Written down value method
    2.   Diminishing balance method
    3.   straight line method
    4.   Reducing balance method