Objective

SUPERIOR GROUP OF COLLEGES Test# 3

INTERMEDIATE
CLASS SUBJECT ACCOUNTING TOTAL MARKS 30
PART-II
DATE SYLLABUS CH# 3 TIME ALLOWED 01 Hours
STUDENT
ROLL NO. SECTION
NAME
Total Marks: 30
Question No. 1: Select the correct answer and encircle it. (06 Marks)
1: Depreciation arises due to:
a) Fall in market value b) Fall in the value of money c) physical wear and tear d) Both a and b
2: Lease hold land are :
a) Current assets b) tangible assets c) fictitious assets d) wasting
assets
3: Cost minus Accumulated depreciation of an assets is also called:
a) Depreciable valu b) Amortization c) Depreciation d) None of
these
4: Under straight line method depreciation is calculated on:
a) Original cost b) written down value c) market value d) scrap value
5: Depreciation is consider for business :
a) liability b) Expense c) income d) assets
6: Depreciation of assts should no exceed:
a) original cost b) Depreciation value c) market value d) Scrap value

Question No. 2: Define the following terms: (10 Marks)

1) what is fixed installment method of

depreciation ?

2) Define depletion ?

3) Why depreciation is charged on assets ?

4) What is meant by obsolescence ?

5) Define wasting assets ?

Question No. 3: (14 Marks)

On 1st January , 1990, Rizwan purchased a machine for Rs.21,000. The estimated useful life of the
machine is 10 years after which its scrape value will be Rs. 1,000/- only

Required: show the machine account for three years under fixed installment method of
depreciation.