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If depreciation rate is equal, the amount of depreciation in SLM method as compared to WDV method will be _________
- a)Equal in first year but will be lesser in remaining year.
- b)Less in first year but will be more in remaining years.
- c)Equal in first year but will be more in remaining years.
- d)Less in first year but will be equal in remaining years.
Correct answer is option 'C'. Can you explain this answer?
Most Upvoted Answer
If depreciation rate is equal, the amount of depreciation in SLM metho...
Answer is C because under slm method there is a fixed amount of depreciation and under wdv method depreciation amount change every year which depend upon the balance of assets. such as - Machine costing 10000 and 10 Percent depreciation . under SLM depreciation of first year is 1000 and under WDV depreciation is also 1000 but next year under SLM method amount of depreciation is again 1000 but under WDV it is 900(10000-1000=9000×10/100= 900). hence our answer is proved
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If depreciation rate is equal, the amount of depreciation in SLM metho...
Explanation:
Depreciation in SLM method:
- In Straight Line Method (SLM), depreciation is calculated by dividing the cost of the asset by its useful life.
- The depreciation amount remains the same each year until the end of the asset's useful life.
Depreciation in WDV method:
- In Written Down Value (WDV) method, depreciation is calculated by applying a fixed percentage to the remaining book value of the asset.
- The depreciation amount decreases each year as the book value of the asset reduces.
Comparison:
- In the first year, the depreciation amount under both methods will be equal as it is based on the same cost of the asset.
- However, in the remaining years, the depreciation amount in the SLM method will be more compared to the WDV method.
- This is because in the SLM method, the depreciation amount remains constant each year, while in the WDV method, the depreciation amount decreases as the book value reduces.
Therefore, the correct answer is option 'C' - Equal in the first year but will be more in the remaining years.
Depreciation in SLM method:
- In Straight Line Method (SLM), depreciation is calculated by dividing the cost of the asset by its useful life.
- The depreciation amount remains the same each year until the end of the asset's useful life.
Depreciation in WDV method:
- In Written Down Value (WDV) method, depreciation is calculated by applying a fixed percentage to the remaining book value of the asset.
- The depreciation amount decreases each year as the book value of the asset reduces.
Comparison:
- In the first year, the depreciation amount under both methods will be equal as it is based on the same cost of the asset.
- However, in the remaining years, the depreciation amount in the SLM method will be more compared to the WDV method.
- This is because in the SLM method, the depreciation amount remains constant each year, while in the WDV method, the depreciation amount decreases as the book value reduces.
Therefore, the correct answer is option 'C' - Equal in the first year but will be more in the remaining years.
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If depreciation rate is equal, the amount of depreciation in SLM method as compared to WDV method will be _________a)Equal in first year but will be lesser in remaining year.b)Less in first year but will be more in remaining years.c)Equal in first year but will be more in remaining years.d)Less in first year but will be equal in remaining years.Correct answer is option 'C'. Can you explain this answer? for CA Foundation 2025 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about If depreciation rate is equal, the amount of depreciation in SLM method as compared to WDV method will be _________a)Equal in first year but will be lesser in remaining year.b)Less in first year but will be more in remaining years.c)Equal in first year but will be more in remaining years.d)Less in first year but will be equal in remaining years.Correct answer is option 'C'. Can you explain this answer? covers all topics & solutions for CA Foundation 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for If depreciation rate is equal, the amount of depreciation in SLM method as compared to WDV method will be _________a)Equal in first year but will be lesser in remaining year.b)Less in first year but will be more in remaining years.c)Equal in first year but will be more in remaining years.d)Less in first year but will be equal in remaining years.Correct answer is option 'C'. Can you explain this answer?.
If depreciation rate is equal, the amount of depreciation in SLM method as compared to WDV method will be _________a)Equal in first year but will be lesser in remaining year.b)Less in first year but will be more in remaining years.c)Equal in first year but will be more in remaining years.d)Less in first year but will be equal in remaining years.Correct answer is option 'C'. Can you explain this answer? for CA Foundation 2025 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about If depreciation rate is equal, the amount of depreciation in SLM method as compared to WDV method will be _________a)Equal in first year but will be lesser in remaining year.b)Less in first year but will be more in remaining years.c)Equal in first year but will be more in remaining years.d)Less in first year but will be equal in remaining years.Correct answer is option 'C'. Can you explain this answer? covers all topics & solutions for CA Foundation 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for If depreciation rate is equal, the amount of depreciation in SLM method as compared to WDV method will be _________a)Equal in first year but will be lesser in remaining year.b)Less in first year but will be more in remaining years.c)Equal in first year but will be more in remaining years.d)Less in first year but will be equal in remaining years.Correct answer is option 'C'. Can you explain this answer?.
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