1. Depreciation is referring to the allocation of the depreciable amount over its estimated useful life. TRUE/FALSE 2. Recording depreciation on non-current asset affects the statement of financial position and statement of profit or loss. TRUE/FALSE 3. In calculating depreciation, both non-current asset cost and useful life are based on estimates. TRUE/FALSE 4. Under reducing balance method, the depreciation rate used each year remains constant. TRUE/FALSE 5. The book value of non-current asset is calculated as cost of the assets minus accumulated depreciation. TRUE/FALSE 6. Estimated value of an asset at the end of its useful life is known as “salvage value”. TRUE/FALSE

1. Depreciation is referring to the allocation of the depreciable amount over its estimated useful life. TRUE/FALSE 2. Recording depreciation on non-current asset affects the statement of financial position and statement of profit or loss. TRUE/FALSE 3. In calculating depreciation, both non-current asset cost and useful life are based on estimates. TRUE/FALSE 4. Under reducing balance method, the depreciation rate used each year remains constant. TRUE/FALSE 5. The book value of non-current asset is calculated as cost of the assets minus accumulated depreciation. TRUE/FALSE 6. Estimated value of an asset at the end of its useful life is known as “salvage value”. TRUE/FALSE

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter7: Fixed Assets, Natural Resources, And Intangible Assets

Section: Chapter Questions

Problem 7.2.2MBA

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Similar questions

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Which of the following statement best describes depreciation? a. It is a means of spreading the payment for non-current assets over a period of years b. It is a decline in the market value of assets c. It is a means of spreading the cost of non-current assets over the estimated useful life d. It is a means of estimating the amount of money needed to replace the assets
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