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Practice Questions
Test your understanding with targeted questions related to the topic.
Question 1
Easy
What is the main purpose of the Double Declining Balance Method?
💡 Hint: Think about why businesses want more depreciation upfront.
Question 2
Easy
How is the book value calculated at the start of the first year?
💡 Hint: Consider the components of the initial purchase.
Practice 4 more questions and get performance evaluation
Interactive Quizzes
Engage in quick quizzes to reinforce what you've learned and check your comprehension.
Question 1
What does the Double Declining Balance Method primarily accelerate?
- Revenue
- Expenses
- Depreciation
💡 Hint: Focus on what is affected during the asset's life.
Question 2
True or False: The DDB method considers salvage value in calculations.
- True
- False
💡 Hint: Think about how DDB differs from other methods.
Solve 1 more question and get performance evaluation
Challenge Problems
Push your limits with challenges.
Question 1
A machine costs ₹100,00,000 with tire costs of ₹10,00,000, expected to have a salvage value of ₹20,00,000 over 10 years. Calculate its depreciation over five years using DDB and determine if switching is required. Show your workings.
💡 Hint: Keep track of the book value each year!
Question 2
Analyze a scenario where the DDB method results in a value lower than the salvage value. What steps must you take? Provide a detailed explanation and recalculation.
💡 Hint: Think about accounting practices and financial health.
Challenge and get performance evaluation