Could you please solve mcqs after solving this question As Soon As Possible Company XYZ purchased a plant costing $100,000 and $5,000 was incurred to get the plant installed at company. It is estimated that the plant has a useful life of 10 years with zero residual value. However, the units produced by using this plant from year 1 to year 10 are given as 1000, 900, 800, 750, 600, 500, 450, 400, 350, 150 respectively.
Depreciation Methods
The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.
Depreciation Accounting
In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.
Could you please solve mcqs after solving this question As Soon As Possible
Company XYZ purchased a plant costing $100,000 and $5,000 was incurred to get the plant
installed at company. It is estimated that the plant has a useful life of 10 years with zero residual
value. However, the units produced by using this plant from year 1 to year 10 are given as 1000,
900, 800, 750, 600, 500, 450, 400, 350, 150 respectively.
Step by step
Solved in 2 steps with 2 images
