Subject : ACCOUNTANCY Topic: Depreciation CLASS: XI
Name: _______________________ Sec : ____ Roll No: _____Date : _________
Q1 Solve the following questions.(1 Marker)
1. Annual depreciation of an asset is Rs.25, 000 and the cost of acquiring an asset is Rs.5, 00,000. So the rate
of depreciation would be ____% p.a.
2. In the books of Vandana Ltd. the machinery account shows a debit balance of Rs.48, 000 as on April 1,
[Link] original cost of which was Rs.75,000. The Machinery was sold on September 30, 2015 for
Rs.42, 000. The company charges depreciation @20% p.a. on Straight line Method. The depreciation for 2013-
2014 is
a. Rs. 15,000 b. Rs. 9,600 c. Rs. 4,800 d. Rs.7, 500
3. Which of the following tangible fixed asset cannot be depreciated?
a. Building b. Vehicle c. Plant d. Land
4. Which of the following statement is true?
a. Depreciation is a charge against profit. b. Depreciation is an appropriation to profit
c. Depreciation is provided only if there is a profit. d. In case of loss, depreciation should not be charged.
5. The loss on sale of asset is debited to
a. Reserves b. Depreciation fund c. Profit and Loss Account d. None of the Above.
6. What is the amount of difference between the closing Balance of 2 machines after 2 years , if both the machine
were purchased on the same date and with the same amount i.e., Rs.2,00,[Link] I is depreciated by 10%
p. a. under Straight Line Method and Machine II is depreciated by 10%p.a. on Written Down value Method:
a. Both Values will be equal b. Value of Machinery II is more by Rs.2, 000
c. Value of Machinery I is more by Rs.4,000 d. Value of Machinery II is more by Rs.4, 000
7. Amortization refers to the process of writing off:
a. Depleting assets b. wasting Assets c. Intangible assets d. fictitious assets
8. On 1st January 2021 books of a business showed an asset at Rs.6, 40,000. Business charges depreciation
@ 10%p.a on original cost every year on 31 st December. If the asset is purchased on 1 st January 2019 what is
the cost of the asset?
a. Rs.8,10,000 b. Rs.9,00,000 [Link].6,56,000 [Link].5,90,490
9. Machinery Account of a business appeared as under:
Particulars Amt Particulars Amount
A) To Balance B/d 58000 D) By Bank(sale of machinery) 15,000
B) To Cash(Repairs) 6,000 E) By Depreciation 30,000
C) To Bank (Machinery purchased) 60,000 F) By Gain on sale 5,000
G) By Bal c/d 74,000
Choose the wrong entry
a. A and G b. B and F c. C and D d. E
10. Solve the following case study.
On 1st October, 2020 a business sold machinery costing Rs.2, 00,000 for Rs.95, 000. Business provides
depreciation every year on 31 st March and maintains provision for depreciation account. All machineries are
depreciated at the same rate. Its provision for depreciation account for the year appeared as under.
Date Particulars Amount Date Particulars Amount
2020-21 2020-21
AIS/ 2023-24/ ACCOUNTANCY /XI /DEPRECIATION Page 1 of 2
Oct 1 To Machinery A/c 70,000 April 1 By balance B/d 92,500
March To Balance c/d 82,500 Oct1 By depreciation 10,000
31
March 31 By Depreciation 50,000
1,52,500 1,52,500
st
a. What is the amount of accumulated depreciation as on 1 April, 2020 of the asset sold?
i) Rs.70, 000 ii) Rs.60,000 iii) Rs.40,000 iv) Rs.20,000
b. What is the gain or loss on sale of machinery?
a) Gain Rs.95,000 b) Loss Rs.45, 000 c) Loss Rs.35, 000 d) None of these
Q2. On Jan 01, 2012 Jain & Sons purchased a second hand plant costing Rs.2, 00,000 and spent Rs.10, 000
on its overhauling. It also spent Rs.5, 000 on transportation and installation of the plant. It was decided to provide
for depreciation @ of 20% on written down value. The plant was destroyed by fire on July 31, 2015 and an
insurance claim of Rs.50, 000 were admitted by the insurance company. Pass necessary journal entries and
open provision for depreciation and Asset Disposal account.
Q3. M/s Digital Studio bought a machine for Rs.8, 00,000 on April 01, 2013. Depreciation was provided on
straight-line basis at the rate of 20% on original cost. On April 01, 2015 a substantial modification was made in
the machine to make it more efficient at a cost of Rs.80, 000. This amount is to be depreciated @ 20% on straight
line basis. Routine maintenance expenses during the year 2013-14 were Rs.2, 000. Draw up the Machine
account, Provision for depreciation account and charge to profit and loss account in respect of the accounting
year ended on March 31, 2016.
Q4. Carriage Transport Company purchased 5 trucks at the cost of Rs.2, 00,000 each on April 01, 2011. The
company writes off depreciation @ 20% p.a. on original cost and closes its books on December 31, every year.
On October 01, 2013, one of the trucks is involved in an accident and is completely destroyed. Insurance
company has agreed to pay Rs.70, 000 in full settlement of the claim. On the same date the company purchased
a second hand truck for Rs.1, 00,000 and spent Rs.20, 000 on its overhauling. Prepare truck account and
provision for depreciation account for the three years ended on December 31, 2013.
Q5. M/s Lokesh Fabrics purchased a Textile Machine on April 01, 2011 for Rs.1, 00,000. On July 01, 2012
another machine costing Rs.2, 50,000 was purchased. A part of machine costing Rs.20,000 purchased on April
01, 2011 was sold for Rs.25,000 on October 01, 2015. The company charges depreciation @15% p.a. on W.D.V.
Prepare machinery account and machinery disposal account and Depreciation A/c for the year ended March 31,
2016
AIS/ 2023-24/ ACCOUNTANCY /XI /DEPRECIATION Page 2 of 2
