Which of the following is NOT a method of calculating depreciation? MCQ with Answer and Explanation

Which of the following is NOT a method of calculating depreciation?
A. Sum of the Years' Digits Method
B. Diminishing Balance Method
C. Straight Line Method
D. LIFO Method
Answer: Option D
Solution (By JKSSB Mock Tests)
LIFO (Last In, First Out) is an inventory valuation method, not a method for calculating depreciation.

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Practice More Accountancy and Book Keeping Questions

Question #1
Consider the following statements about the 'Money Measurement Concept': 1. Only transactions that can be expressed in monetary terms are recorded. 2. Non-monetary events like a strike or labour unrest are also recorded if they affect business. 3. The concept assumes that the purchasing power of money remains stable. Which of the above statements are correct?
A. 2 and 3 only
B. 1 and 2 only
C. 1 and 3 only
D. 1, 2 and 3

Correct Answer: Option C


Explanation:
Statement 1 is correct, 2 is incorrect because non-monetary events are not recorded. 3 is correct as an inherent assumption of the money measurement concept.

Question #2
If Sales are Rs 1,00,000, Variable Cost is Rs 60,000, what is the Contribution Margin Ratio (P/V Ratio)?
A. 40%
B. 60%
C. 20%
D. 100%

Correct Answer: Option A


Explanation:
Contribution = Sales - Variable Cost = 40,000. P/V Ratio = (Contribution / Sales) * 100 = 40%.

Question #3
The balance of 'Petty Cash Book' is:
A. Income
B. An asset
C. A liability
D. An expense

Correct Answer: Option B


Explanation:
Petty cash balance is cash in hand, an asset.