Complete the formula by filling the correct option in the numerator:

Depreciation = Cost of Asset - ( )
____________________
Estimated useful life of the asset

Estimated net residual value

Right on! Give the BNAT exam to get a 100% scholarship for BYJUS courses

Cost or liabilities

No worries! We‘ve got your back. Try BYJU‘S free classes today!

Gross profit

No worries! We‘ve got your back. Try BYJU‘S free classes today!

Net profit

No worries! We‘ve got your back. Try BYJU‘S free classes today!

Open in App

Solution

The correct option is A Estimated net residual value
Depreciation is calculated on the net cost of assets i.e. after deducting the residual value of the asset. Depreciation will be calculated on straight line method as:

Depreciation= Cost of Asset- Estimated net residual value
Estimated useful life of asset

Suggest Corrections

Similar questions

Q. Useful life of a depreciation asset should be estimated after considering:

Q. Depreciation Accounting has been defined by the ________ as " a system of accounting which aims to distribute the cost or other basic value of tangible capital assets less salvage (if any) over the estimated useful life of the unit (which may be a group of assets) in a systematic and rational manner. It is a process of allocation and not of valuation".

Q. Purchase of a fixed asset by a non-profit organization will be shown in _____________.

Q. Depreciation is a ________ shrinkage in the book value of a fixed asset.

___is a method of depreciation, in which the cost of the asset is spread uniformly over the life years by writing off a fixed amount every year, where as in ___ method of depreciation, a fixed rate of depreciation is charged on the book value of the asset over its useful life.

Join BYJU'S Learning Program

Complete the formula by filling the correct option in the numerator:Depreciation = Cost of Asset - ( ________________________ ) ____________________________________________ Estimated useful life of the asset

Complete the formula by filling the correct option in the numerator:

Depreciation = Cost of Asset - ( )
____________________
Estimated useful life of the asset