7. It is an amount which a willing buyer will pay to a willing seller for the property where each has equal advantage and is under no compulsion to buy or sell. A. Use value C. Market value B. Salvage value 8. The amount that the property would give if sold for junk. A. Junk value C. Salvage value D. Book value B. Book value D. Scrap value 9. A type of depreciation is due to the reduction of the physical ability of an equipment or asset to produce results. A. Physical depreciation B. Design depreciation C. Functional depreciation D. Demand depreciation

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
icon
Related questions
Question
7-9 with explanation
1. Which of the following is true about the straight-line method?
A. Complex method
B. Cost of depreciation remains constant
C. Cost of depreciation changes every year
D. Profit and Loss account debited with different amount every year
2. Reduction in the book value of an asset over a period of time is called-
A. Appreciation
C. Proportion
B. Depreciation
D. Depletion
3. Which among the following is Not a reason for depreciation?
A. Use of asset
B. Obsolescence
4. It is the main object of providing depreciation.
A. To calculate true profit
C. Passage of time
D. Repair of an asset
C. To show true financial position
D. To provide funds for replacement
B. To reduce tax
5. Which is excluded in straight line method of depreciation?
A. Useful life of the asset
B. Cost of the asset
6. It refers to the estimated disposal value of an asset.
A. Use value
C. Annual cost of repair
D. Expected salvage value
C. Market value
B. Salvage value
D. Book value
7. It is an amount which a willing buyer will pay to a willing seller for the property where each has
equal advantage and is under no compulsion to buy or sell.
A. Use value
C. Market value
B. Salvage value
8. The amount that the property would give if sold for junk.
A. Junk value
C. Salvage value
D. Book value
B. Book value
D. Scrap value
9. A type of depreciation is due to the reduction of the physical ability of an equipment or asset to
produce results.
A. Physical depreciation
C. Functional depreciation
B. Design depreciation
D. Demand depreciation
10. It refers to the reduction in the demand for the function that the equipment or asset was designed
to render.
Transcribed Image Text:1. Which of the following is true about the straight-line method? A. Complex method B. Cost of depreciation remains constant C. Cost of depreciation changes every year D. Profit and Loss account debited with different amount every year 2. Reduction in the book value of an asset over a period of time is called- A. Appreciation C. Proportion B. Depreciation D. Depletion 3. Which among the following is Not a reason for depreciation? A. Use of asset B. Obsolescence 4. It is the main object of providing depreciation. A. To calculate true profit C. Passage of time D. Repair of an asset C. To show true financial position D. To provide funds for replacement B. To reduce tax 5. Which is excluded in straight line method of depreciation? A. Useful life of the asset B. Cost of the asset 6. It refers to the estimated disposal value of an asset. A. Use value C. Annual cost of repair D. Expected salvage value C. Market value B. Salvage value D. Book value 7. It is an amount which a willing buyer will pay to a willing seller for the property where each has equal advantage and is under no compulsion to buy or sell. A. Use value C. Market value B. Salvage value 8. The amount that the property would give if sold for junk. A. Junk value C. Salvage value D. Book value B. Book value D. Scrap value 9. A type of depreciation is due to the reduction of the physical ability of an equipment or asset to produce results. A. Physical depreciation C. Functional depreciation B. Design depreciation D. Demand depreciation 10. It refers to the reduction in the demand for the function that the equipment or asset was designed to render.
Expert Solution
steps

Step by step

Solved in 5 steps

Blurred answer
Knowledge Booster
Rental Agreement
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.
Similar questions
Recommended textbooks for you
ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
Economics
ISBN:
9780190931919
Author:
NEWNAN
Publisher:
Oxford University Press
Principles of Economics (12th Edition)
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (MindTap Course List)
Principles of Economics (MindTap Course List)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Managerial Economics: A Problem Solving Approach
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-…
Managerial Economics & Business Strategy (Mcgraw-…
Economics
ISBN:
9781259290619
Author:
Michael Baye, Jeff Prince
Publisher:
McGraw-Hill Education