Depreciation, Provisions and Reserves · Class 11 · CBSE · Commerce Accountancy
Which of the following methods of depreciation results in a reducing charge of depreciation each year?
Practice question from Depreciation, Provisions and Reserves (Class 11 · CBSE · Commerce Accountancy), with the correct answer and a step-by-step solution.
medium · MCQ · Q-7C2F30
Which of the following methods of depreciation results in a reducing charge of depreciation each year?
- A.Straight Line Method
- B.Written Down Value MethodCorrect answer
- C.Depletion Method
- D.Insurance Policy Method
Solution
Under the Written Down Value (WDV) method, depreciation is calculated on the diminishing balance (book value) of the asset each year, resulting in a progressively smaller depreciation charge.
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