Accountancy Part II - Depreciation, Provisions and Reserves Quiz
Ready to take the quiz?
Test takers will enter name and email before starting.
Preview questions
1. What is the primary purpose of depreciation?
To increase asset value · To allocate the cost of an asset over its useful life · To reduce tax liabilities · To enhance cash flow
2. Which method of depreciation calculates depreciation based on the asset's usage?
Straight Line Method · Reducing Balance Method · Units of Production Method · Sum of Years' Digits Method
3. What is the effect of not accounting for depreciation on the financial statements?
Overstated profits · Understated assets · No impact on net income · Increased liabilities
4. Which of the following is NOT a method of calculating depreciation?
Straight Line Method · Declining Balance Method · Average Cost Method · Units of Production Method
5. What does the term 'provision' refer to in accounting?
An expense that is certain · A liability of uncertain timing or amount · An asset that is overvalued · A reserve for future profits
Related quizzes
View all AccountancyAccountancy Quiz - Financial Statements II
Financial Statements - II
Accountancy Part I - Theory Base of Accounting Quiz
Theory Base of Accounting
Accountancy - Introduction to Accounting
Introduction to Accounting
Applications of Computers in Accounting - Class XI Quiz
Applications of Computers in Accounting
Accountancy Part I - Theory Base of Accounting Quiz
Theory Base of Accounting
Trial Balance and Rectification of Errors - Class XI Accountancy Quiz
Trial Balance and Rectification of Errors