| MCQS | EACH QUESTIONS HAS FOUR POSSIBLE ANSWERS CHOOSE THE CORRECT ANSWER: (T) Means TRUE Answer |
| (1) | The main object of providing depreciation is: |
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| (a) To calculate true profit. (T)
(b) To show true financial position. (c) To reduce tax.
(d) To provide funds for replacement.
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| (2) | Depreciation arises because of: |
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| (a) Fall in the market value of an asst.(b) Physical wear and tear. (T) (c) Fall in the value of money.
(d) None of them.
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| (3) | Depreciation is a process of: |
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| (a) Valuation (T)
(b) Allocation (c) Both valuation and allocation
(d) None of them.
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| (4) | Under the straight line method of providing depreciation it: |
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| (a) Increase every year.(b) Remain constant every year. (T) (c) Decreases every year
(d) None of them.
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| (5) | Under the diminishing balance method depreciation it: |
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| (a) Increases every year.(b) Decreases every year. (T) (c) Remain constant every year.
(d) None of them.
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| (6) | Under the fixed installment method of providing depreciation it is calculated on: |
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| (a) Original cost (T)
(b) on balance amount(c) On scrap value (d) None of them |
| (7) | Under the diminishing balance method, depreciation is calculated on: |
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| (a) Scrap value (b) On original value(c) On book value (T)
(d) None of them |
| (8) | The amount of depreciation charged on a machinery will be debited to: |
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| (a) Machinery account (b) Depreciation account (T)
(c) Cash account d) Repair account |
| (9) | Loss on sale of plant and machinery should be written off against: |
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| (a) Share premium(b) Depreciation fund account (T) (c) Sale account
(d) Profit & loss account
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| (10) | Loss on sale of machinery will be: |
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| (a) Debited on machinery A/c(b) Credited to machinery A/c (T) (c) Credited to profit and loss A/c
(d) None of them
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| (11) | Asset which have a limited useful life are termed as: |
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| (a) Limited assets (b) Depreciation assets (T)
(c) Unlimited asset (d) None of these |
| (12) | Process of becoming out of date or obsolete is termed as: |
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| (a) Physical deterioration (b) Depletion(c) Obsolescence (T)
(d) Amortization |
| (13) | Which of the term is used to write off in reference to tangible fixed assets. |
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| (a) Depreciation(T) (b) Depletion(c) Amortization (d) Both (b) and (c) |
| (14) | The economic factors causing depreciation: |
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| (a) Time factor(b) Obsolescence and inadequacy (T) (c) Wear and tear
(d) Money valuation
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| (15) | Profit prior to incorporation is an example of: |
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| (a) Capital reserve (T)
(b) Revenue reserve(c) Secret reserve (d) None of these |
| (16) | Total depreciation cannot exceeds its: |
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| (a) Scrap value (b) Cost value(c) Market value (d) Depreciable value (T) |
| (17) | Depreciation value of an asset is equal to: |
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| (a) Cost + Scrap value (b) Cost + Market price(c) Cost – Scrap value (T)
(d) None of these |
| (18) | Depreciation does not depend on fluctuations as: |
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| (a) Market value of asset (T)
(b) Cost of price of asset(c) Scrap value of asset (d) None of these |
| (19) | Depreciation is: |
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| (a) An income (b) An asset(c) A loss (T)
(d) A liability |
| (20) | The books value of an asset is obtained by deducting depreciation from its: |
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| (a) Market value (b) Scrap value(c) Market + Cost price (d) Cost (T) |
| (21) | Depreciation fund method is also known as: |
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| (a) Sinking fund method (T)
(b) Annuity method (c) Sum of years digits method
(d) None of these
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| (22) | The method is specially suited to natural resources (mines, quarries, sand, pits etc.) is said to be: |
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| (a) Annuity method (b) Depletion method (T)
(c) Revaluation method (d) Sum of digits method |
| (23) | Double – declining method is often used in the: |
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| (a) Pakistan (b) South Africa(c) Japan (d) U.S.A (T) |
| (24) | In the provision method of depreciation the asset always appears at: |
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| (a) Cost price (T) (b) Market Price(c) Scrap Value (d) None |
you should also post the answers
ReplyDeleteANSWERS ARE THERE NA.....INDICATED BY (T)
ReplyDeleteI already indicated answers by showing alphabet (T)
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