BUSINESS ADMINISTRATION
FINANCIAL ACCOUNTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Which of the following is/are causes of depreciation?
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Wear and tear
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Obsolescence
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Inadequacy
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All of the above
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Explanation:
Detailed explanation-1: -There are generally two main causes of depreciation, first is normal cause such as normal wear and tear due to usage or passage of time, expiration of legal right in case of some assets and obsolescence due to technological advancement and second is abnormal cause such as accidents due to fire, earthquake, floods etc.
Detailed explanation-2: -Following are the causes of Depreciation excepta)Wear and tear due to use or passage of time. b)normal factorsc)Expiration of legal rights. d)Obsolescence. Correct answer is option ‘B’.
Detailed explanation-3: -Repair of an asset is not a reason for depreciation.
There is 1 question to complete.