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CPT Section A: Fundamentals of Accounting 
Chapter-5  
Part 5: Miscellaneous Concepts of Depreciation 
CA. Poonam Patni 
 
 
Depreciation Accounting 
Page 2


CPT Section A: Fundamentals of Accounting 
Chapter-5  
Part 5: Miscellaneous Concepts of Depreciation 
CA. Poonam Patni 
 
 
Depreciation Accounting 
THE TOPICS ALREADY COVERED IN PART : 4 
INSURANCE POLICY METHOD 
DEPLETION METHOD 
DOUBLE DECLINING METHOD 
SALE  OF DEPRECIABLE ASSET 
Page 3


CPT Section A: Fundamentals of Accounting 
Chapter-5  
Part 5: Miscellaneous Concepts of Depreciation 
CA. Poonam Patni 
 
 
Depreciation Accounting 
THE TOPICS ALREADY COVERED IN PART : 4 
INSURANCE POLICY METHOD 
DEPLETION METHOD 
DOUBLE DECLINING METHOD 
SALE  OF DEPRECIABLE ASSET 
LEARNING OBJECTIVES 
Change in 
method of 
Depreciation 
Revision of 
the  
estimated 
useful life 
of the 
asset 
Revaluation 
of  
depreciable 
asset 
Provision 
for repairs 
& renewals  
Practice  
Questions 
Page 4


CPT Section A: Fundamentals of Accounting 
Chapter-5  
Part 5: Miscellaneous Concepts of Depreciation 
CA. Poonam Patni 
 
 
Depreciation Accounting 
THE TOPICS ALREADY COVERED IN PART : 4 
INSURANCE POLICY METHOD 
DEPLETION METHOD 
DOUBLE DECLINING METHOD 
SALE  OF DEPRECIABLE ASSET 
LEARNING OBJECTIVES 
Change in 
method of 
Depreciation 
Revision of 
the  
estimated 
useful life 
of the 
asset 
Revaluation 
of  
depreciable 
asset 
Provision 
for repairs 
& renewals  
Practice  
Questions 
CHANGE IN THE METHOD OF  DEPRECIATION 
CHANGE- Ex: From SLM to WDV method or vice versa.  
Statutory requirement 
Compliance with the accounting 
standard 
Appropriate preparation & 
presentation of the financial 
statements 
WHEN 
Page 5


CPT Section A: Fundamentals of Accounting 
Chapter-5  
Part 5: Miscellaneous Concepts of Depreciation 
CA. Poonam Patni 
 
 
Depreciation Accounting 
THE TOPICS ALREADY COVERED IN PART : 4 
INSURANCE POLICY METHOD 
DEPLETION METHOD 
DOUBLE DECLINING METHOD 
SALE  OF DEPRECIABLE ASSET 
LEARNING OBJECTIVES 
Change in 
method of 
Depreciation 
Revision of 
the  
estimated 
useful life 
of the 
asset 
Revaluation 
of  
depreciable 
asset 
Provision 
for repairs 
& renewals  
Practice  
Questions 
CHANGE IN THE METHOD OF  DEPRECIATION 
CHANGE- Ex: From SLM to WDV method or vice versa.  
Statutory requirement 
Compliance with the accounting 
standard 
Appropriate preparation & 
presentation of the financial 
statements 
WHEN 
In case of change in method of 
depreciation. 
Recalculation of  depreciation is done in 
according to the new method of depreciation. 
Deficiency or surplus arising from such 
retrospective recomputation should be  Dr. or Cr. 
to the P&L a/c of the year of change of method.  
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FAQs on PPT : Depreciation Accounting - 5 - Accountancy Class 11 - Commerce

1. What is depreciation accounting?
Ans. Depreciation accounting is a method used to allocate the cost of an asset over its useful life. It helps in recognizing and recording the decrease in value of an asset due to wear and tear, obsolescence, or other factors.
2. How is depreciation calculated?
Ans. Depreciation can be calculated using various methods such as straight-line depreciation, declining balance depreciation, or units of production depreciation. The most common method is the straight-line method, where the cost of the asset is divided by its useful life to determine the annual depreciation expense.
3. What is the purpose of depreciation accounting?
Ans. The purpose of depreciation accounting is to accurately reflect the reduction in value of an asset over time. It helps in matching the cost of the asset with the revenue it generates during its useful life, ensuring that the financial statements provide a true and fair view of the company's financial position.
4. How does depreciation affect financial statements?
Ans. Depreciation affects financial statements by reducing the value of the asset on the balance sheet and increasing the depreciation expense on the income statement. This leads to a decrease in the company's net income and profitability. Additionally, it also impacts the company's cash flow statement as it represents a non-cash expense.
5. Can depreciation be reversed or cancelled?
Ans. No, depreciation cannot be reversed or cancelled once it has been recorded. It reflects the systematic allocation of the asset's cost over its useful life and cannot be undone. However, if the asset's useful life or value is revised, the depreciation method or rate can be changed to reflect the updated information.
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