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Business Arithmetic — Entrepreneurship STD 12 Commerce — Question

CBSE BoardEnglish MediumSTD 12 CommerceEntrepreneurshipBusiness Arithmetic3 Marks
Question
What is the basic difference between 'depreciation' and 'amortisation'? Give any two methods of charging depreciation.
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Answer

The basic difference between 'depreciation' and 'amortisation' is that depreciation is charged on tangible assets and amortisation is an act of writing off intangible assets. Two methods of charging depreciation are as follows:
  1. Fixed instalment method.
  2. Reducing balance method.

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