what do you understand by appreciation and depreciation of
fixed assets?
- 1 Answers
- 7721 Views
- I also Faced
- E-Mail Answers
Answer / danny deb
Appreciation of an asset means that the market value has
gone higher than the value at which it has been brought.
eg. Land..u buy a land today for say 5 lakhs and after 2-5
years u sell the same land in 10 lakhs. This means that the
value of land(fixed asset) has appreciated by 5 lakhs.
Depreciation of an asset means that the value of the asset
has gone down from its buying or purchase value due to use,
wear and tear.
Eg.. Machinery...u buy a machine at the market value of 1
Lakh. U use it for 2 years. the value of the same machine
will reduce if u resell it as u have used it and also to the
constant wear and tear, repairs etc. A company or firm
always keeps a provision for this and deducts depreciation
at a suitable percentage(lets say 10% or 15%) depending on
the type of asset and its use.
Hopefully i have answered correct!!! ha..ha..ha
all the best!!!
| Is This Answer Correct ? | 9 Yes | 2 No |
if at the end of the year cash book is showing debit balance whether it is meant that cash is not deposited after deducting expenses in bank and it is in hand and we should deposit in next year
Golden Words Of Accounting?
What is diffrence between Satutory Liquid Ration and Cash Reserve Ratio?
Tell us do you have any professional experience of this field?
We had billed to a Customer Rs. 50000/- he paid 45000 to us n not paying balance 5000/- how and where to enter Rs. 5000/- Is it bad debt...
mr.atul purchased a dress for his son amounting to rs 725/- from dress point by paying cash from the office. We entered in this trasaction to which voucher?
In which book we can learn in detail of closing stock valuation. And if any site is available kindly help.
what is reserve capital
What is finance lease? What are bonus Shares? entry for it. What is Depreciation? What is the Journal Entry? What is DPS? What is minority Interest? where it is shown?
What do we mean by Redemption of shares and debentures?
in insolvency we have to prepare deficiency account but why we do not prepare this account as per general principle i.e Dr Cr To By etc , and deficiency account is which account?
why companies put ltd and pvt ltd,what is the difference?
Audit 
