A. Straight line method
B. Declining balance
C. Both A. and B.
D. Neither A. nor B.
Related Mcqs:
- Annual depreciation costs are constant, when the ______________ method of depreciation calculation is used ?
A. Declining balance
B. Straight line
C. Sum of the years digit
D. None of these - Annual depreciation cost are not constant when, the _____________ method of depreciation calculation is used ?
A. Straight line
B. Sinking fund
C. Present worth
D. Declining balance - The depreciation during the year ‘n’, in diminishing balance method of depreciation calculation, is calculated by multiplying a fixed percentage ‘N’ to the ?
A. Initial cost
B. Book value at the end of (n – 1)th year
C. Depreciation during the (n – 1)th year
D. Difference between initial cost and salvage value - ________________ of depreciation calculation does not take into account the interest on investments?
A. Present worth method
B. Sinking fund method
C. Sum of the years-digits method
D. All A, B. and C. - The amount of simple interest during ‘n’ interest period is (where, i = interest rate based on the length of one interest period, p = principal) ?
A. p.i.n.
B. p(1 + i.n)
C. p(1 + i)n
D. p(1 – i.n) - An annuity is a series of equal payments occuring at equal time intervals, and this amount includes the sum of all payments plus interest, if allowed to accumulate at a definite rate of interest from the time of initial payment to the end of annuity term. Ordinary annuity is used in the calculation of the__________________?
A. Manufacturing cost
B. Depreciation by sinking fund method
C. Discrete compound interest
D. Cash ratio - In declining balance method of depreciation calculation, the _____________________?
A. Value of the asset decreases linearly with time
B. Annual cost of depreciation is same every year
C. Annual depreciation is the fixed percentage of the property value at the beginning of the
particular year
D. None of these - An investment of Rs. 1000 is carrying an interest of 10% compounded quarterly. The value of the investment at the end of five years will be ________________?
A. 1000 (1 + 0.1/4)20
B. 1000 (1 + 0.1)20
C. 1000 (1 + 0.1/4)5
D. 1000 (1 + 0.1/2)5 - ‘P’ is the investment made on an equipment, ‘S’ is its salvage value and ‘n is the life of the equipment in years. The depreciation for Rath year by the sum-of year‟s digit method will be____________________?
A. (P – S)/n
B. 1 – (P/S)1/m
C. (m/n) (P – S)
D. [2 (n – m + 1)/n(n + 1)]. (P – S) - A reactor having a salvage value of Rs. 10000 is estimated to have a service life of 10 years. The annual interest rate is 10%. The original cost of the reactor was Rs. 80000. The book value of the reactor after 5 years using sinking fund depreciation method will be Rs _____________?
A. 40,096
B. 43,196
C. 53,196
D. 60,196
