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Straight line method: This method assume equal amount of
depn over an assets useful life. This translates to equal
depn expenses amount every period.
Reducing method: The reducing balance method of depreciation
provides a high annual depreciation charge in the early
years of an asset's life but the annual depreciation charge
reduces progressively as the asset ages.

To achieve this pattern of depreciation, a fixed annual
depreciation percentage is applied to the written-down value
of the asset. Thus, depreciation is calculated as a
percentage of the reducing balance.
Annuti method: A method of depreciation under which the
depreciation expense is an amount of an Annuity so that the
amount of the annuity at the end of the useful life would
equal the Acquisition Cost of the asset
fund method:the depreciation charge should include interest
on accumulated depreciation at the beginning of the period.
This method is rarely used in practice.
insurance method:

A firm had the following Balances on 1 January 1994: (i) Provision for bad and doubtful debts Rs 2,500 (ii) Provision for discounts on debtors Rs 1,200 (iii) Provision for discounts on creditors Rs 1,000 During the year, bad debts amounted to Rs 2,000, discounts allowed were Rs 100 and discounts received were Rs 200. During 1995 bad debts amounting to Rs l,000 were written off while discounts allowed and received were Rs 2,000 and Rs 5,000 respectively. Total debtors on 31 December, 1995 were Rs 48,000 before writing off bad debts, but after allowing discounts. On 31 December, 1995, this amount was Rs 19,000 after writing off the bad debts, but before allowing discounts. Total creditors on these two dates were Rs 20,000 and Rs 25,000 respectively. It is the firm’s policy to maintain a provision of 5% against bad and doubtful debts and 2% for discount on debtors and a provisions of 3% for discount on creditors. Show the accounts relating to provisions on debtors and provisions on creditors for the year 1994 and 1995.

2058

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Is it necessary after every journal entry to show its treatment in P&L a/c? Eg. if I am asked to show journal entry of purchasing furniture & fixture on 1st Aug 06, i.e. Furniture & fixture a/c Dr. To cash/bank a/c Along with this, I have to pass following journal entry on 31st Mar 07?? P&L a/c Dr. To Furniture & fixture a/c

1583

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What is the difference between accumulated depreciation and depreciation expense?

1276

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examole of cash to cash contra entry

2283

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What is accounting for plant assets?

1216

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dear sir,how to maintain petty cash book. its voucher and posting on cash book and ledger A/c?

1527

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How can do it TDS in accounts?

2163

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Tell us what kind of work environment do you prefer?

1152

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While finalizing the current year’s profit, the company realized that there was an error in the valuation of closing stock of the previous year. In the previous year, closing stock was valued more by Rs.50,000. As a result (a) Previous year’s profit is overstated and current year’s profit is also overstated (b) Previous year’s profit is understated and current year’s profit is overstated (c) Previous year’s profit is understated and current year’s profit is also understated (d) Previous year’s profit is overstated and current year’s profit is understated

2328

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Please provide me the entire format of P.F. & ESI

2162

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How Adjust The Amount Taken By Partners For Personal Use? Is The Entry For Drawings? Even If The Amt Exceed 5 Lakhs Or As Partners Loan If Its Not Recovered Even After 1 Year? Discribe All.

1861

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What is dividend warrants?

1197

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Types of errors in account

1654

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What information do you require before you approve an invoice for payment?

1202

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What is the abbreviation for the accounting terms debit and credit?

1061

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