Accounting Principles — Account STD 11 Commerce — Question

Depreciation decreases only the book value of the asset, not the market value.

All items or facts whether material or immaterial are recorded in accounting.

There is no difference between written down value method and diminishing balance method of depreciation.

Depreciation is the process of valuation of an asset.

Under diminishing balance method, depreciation is charged on the cost price of fixed asset.

At the time of renewal of a bill, interest account is credited in the books of the drawee.

State whether the following statements are True or False with reason:
Accounting Information must be presented in such a way that only accounting people understand it.

It is incorrect to debit repairs account for the amount spent on the repairs of Plant purchased second hand.

Depreciation cannot be provided in case of loss in a financial year.

Providing depreciation reduces the amount of profit available for dividend.