Question

Under Provision method depreciation charged is credited to _____________.

• A. Provision for depreciation A/c
• B. Provision for Tax A/c
• C. Provision For cost A/c
• D. None

Answer 1

The correct option is A Provision for depreciation A/c

Option A is correct.

Under provision method, assets are maintained at its original cost in the ledger account. Depreciation charged is recorded in a separate account named 'provision for depreciation account.' Also known as 'Accumulated Depreciation Account'. Journal entry to record the depreciation is as follows :-
Profit & Loss A/c Dr.
To Provision For Depreciation A/c.