CameraIcon

SearchIcon

MyQuestionIcon

1

You visited us 1 times! Enjoying our articles? Unlock Full Access!

Trading & Profit or Loss Account

Depreciation ...

Question

Depreciation Accounting is a process of ____________.

A

Allocation of cost

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

B

Valuation of cost

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

C

Provision for losses

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

D

Estimation of net profit

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

Open in App

Solution

The correct option is A Allocation of cost
Depreciation is an accounting process by which a company allocates an asset's cost throughout its useful life. In other words, it records how the value of an asset declines over time.

Suggest Corrections

thumbs-up

0

Similar questions

Q. Depreciation is a process of allocation of the cost of fixed asset.

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. Depreciation was not recorded because to do so wold result in a net loss for the period. Indicate the accounting principle that is violated___________.

Q. Assertion :Depreciation amount is added back to net profit for calculating funds from operation in preparing a funds flow statement. Reason: Depreciation is an item of expense but not funds.

Q. _______ has defined depreciation as "a measure of the wearing out, consumption or other loss of value of a depreciable asset arising from use, effluxion of time of obsolescence through technology and market changes. Depreciation is allocated so as to charge a fair proportion of depreciable amount in each accounting period during the expected useful life of the asset. Depreciation includes amortization of assets whose useful life is predetermined.

View More

Join BYJU'S Learning Program

similar_icon

Related Videos

lock

Profit or Loss Account

ACCOUNTANCY

Watch in App

explore_more_icon

Explore more

Trading & Profit or Loss Account

Standard XI Accountancy

Join BYJU'S Learning Program

CrossIcon