Question : Several methods are used to calculate depreciation of fixed assets of business. What are they?
Option 1: Straight Line method
Option 2: Written down value method
Option 3: Pro-rata Method
Option 4: Both 1 & 2
Correct Answer: Both 1 & 2
Solution : Depreciation on Assets: There are several ways to figure out how much fixed assets in a corporation have depreciated. Using a spreadsheet to calculate depreciation depends on the methodology. It can be accomplished either by formula composition or by using an Excel function. Following is a discussion of the methods: a) The Straight Line Approach This strategy keeps the annual depreciation rate constant. (a) The method of written-down values This method bases depreciation calculations on the asset's declining value.
Hence the correct answer is option 4.
Question : The product method used to calculate the annual value of goods and services produced is also called___________.
Option 1: value added method
Option 2: income method
Option 3: expenditure method
Option 4: depreciation method
Question : If the Balance Sheet does not have an item of Provision for Depreciation or Accumulated Depreciation, it means that fixed assets are shown in the Balance Sheet at their--------------.
Option 1: Written down value
Option 2: Original cost
Option 3: Both 1 and 2
Option 4: None of the above
Question : When the Balance Sheet has an item of Provision for Depreciation or Accumulated Depreciation for both years, it means that the fixed assets are shown in the Balance Sheet at their-------------.
Option 3: Both A and B
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