Question

A company bought machinery for Rs. 10000 and depreciation rate is 10%. Provision for depreciation account is maintained. Which of the following is correct?

• A. Depreciation Account Debit 100
• B. Depreciation Account Debit 10000
• C. Provision for Depreciation Account credit 1000
• D. Profit & loss Account Debit 10000

Answer 1

The correct option is C

Provision for Depreciation Account credit 1000

The correct entry would be
Depreciation Account Debit 1000
Provision for Depreciation Account Credit 1000