MCQ on depreciation (Part-3 From Q-41 to 60)
MCQ on depreciation (Part-3 From Q-41 to 60)
41. Cost of a machine = ~ 1,12,500 salvage value = ~ 10,500 Useful Life = 5 Years Deprecation for the last year using the Sum of digits method will be:
(a) ~ 6,800
(b) ~ 20,400
(c) ~ 34,000
(d) ~ 27,200
42. Depreciation starts on a machine from the date:
(a) It is purchased
(b) It is put to use
(c) It is installed
(d) Any of above
43. A trader purchased a machinery for ~ 10,000 in Jan 2004. Depreciation is charged @ 25% diminishing balance. At the end of third year it was sold for ~ 1,000. Profit or Loss on sale of machine will be:
(a) Profit ~ 2,400
(b) Profit ~ 2,300
(c) Loss ~ 2,406
(d) Loss ~ 3,219
44. Cost of machinery ~ 2,52,000 Salvage value ~ 12,000 Useful life 6 years Annual depreciation under straight line method will be:
(a) ~ 42,000
(b) ~ 40,000
(c) ~ 15,000
(d) ~ 28,000
45. Which of the following is Depleted?
(a) Land
(b) Goodwill
(c) Machinery
(d) Coal Mines
46. A machine was purchased on 1 st April, 2007 for ~ 5,00,000 and pt October, 2007 for ~ 2,00,000. Calculate depreciation @ 20% p.a on written down value method for the year ending 31 st March, 2008.
(a) ~ 1,00,000
(b) ~ 1,40,000
(c) ~ 40,000
(d) ~ 1,20,000
47. A machinery is depreciated by ~ 2,000 every year. Which method is being used to calculate depreciation?
(a) Written Down value method
(b) Straight line method
(c) Sum of Years Digit method
(d) None of these .
48. A purchased a mine for ~ 2,50,000 minerals in the mine were expected to be 5,00,000 tonnes. In the first year, 50,000 tonnes of minerals were used. What is the depreciation for the first year?
(a) ~ 20,000
(b) ~ 25,000
(c) ~ 30,000
(d) ~ 35,000
49. A machine was purchased for ~ 50,000. Installation expenses amounted to ~ 2,000 wages of ~ 4,000 were paid on installation.’ The scrap value at the end of its useful life of 10 years is ~ 6,000. Repairs of ~ 6,000 was made after 6 months from the date of purchase. Calculate depreciation
(a) ~ 5,600
(b) ~ 4,800
(c) ~ 5,000 .
(d) None
50. Which method of depreciation is suitable when expenditure on repairs and maintenance, increases as the machine grows old?
(a) Reducing balance method
(b) Straight line method
(c) Machine hour rate method
(d) Sinking fund Method.
(a) Straight line Method
(b) None of these
(c) Both, Straight Line and Diminishing Balance Methods
(d) Diminishing Balance Method
52. Asset Disposal A/c is prepared when :
(a) Provision for Depreciation A/c is prepared
(b) Asset A/c is prepared
(c) Profit & Loss A/c is prepared
(d) Depreciation A/c is prepared
53. Which of the following is the example of Capital Reserve?
(a) Workmen’s Compensation Fund
(b) None of these
(c) Premium Received on issue of shares or debentures
(d) General Reserve
54. Which of the following is the example of Revenue Reserve?
(a) Profit on Redemption of Debentures
(b) Profit on Revaluation of Fixed
(c) Investment Fluctuation Fund
(d) Profit on Re-issue of forfeited shares
55. Dividend Equalisation Reserve is :
(a) Specific Reserve
(b) None of these
(c) Secret Reserve
(d) General Reserve
56. General Reserves are shown in :
(a) Revaluation Account
(b) Profit and Loss Account
(c) None of these
(d) Balance Sheet
57. According to Companies Act, 1956 Secret Reserves can be created by:
(a) Only Private Company
(b) Banking and insurance companies
(c) Only Public Company
(d) Companies Registered under Companies Act
58. The loss on sale of an asset is debited to:
(a) Profit and Loss Account
(b) Trial Balance Cr. Side
(c) Balance Sheet
(d) Trading Account
59. Depreciation is Charged on :
(a) Current Assets
(b) Fixed Tangible Assets
(c) None of these
(d) Both Current and Fixed Assets
60. At the end of the year, Depreciation Account is transferred to :
(a) Balance Sheet
(b) Trading Account
(c) Profit & Loss Appropriation Account
(d) Profit & Loss Account
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