In this article, We have provided the Question-wise solution of all Questions of Chapter 12 Depreciation – D.K. Goel -(Class 11 – ISC)- Solution But first of all, we have explained the meaning of Depreciation.
What is Depreciation
Depreciation means the decrease in the value of Fixed assets over time. It is charged only on fixed assets (except Land) Because every fixed asset has a life of more than one year but will not last indefinitely. The land has an indefinite life so it will be appreciated. Depreciation is treated as an indirect expense of the business and transferred to the income statement of the company and the profit/loss account of the business.
There are three types of decreases in the value of an asset, which refers to a different category of fixed assets shown as follows.
- Depreciation
- Depletion
- Amortization
1. Depreciation is used for the Tangible fixed asset. Such as Building, Plant, Machinery, Furniture, fixtures, Vehicle, Computer, etc.
2. Depletion is used in referring to the physical exhaustion of natural resources. Such as oil wells, Coal mines, etc.
3. Amortization is used for the Intangible fixed asset. Such as Goodwill, Patents, trademarks, leaseholds, etc.
Chapter 12 Depreciation – D.K. Goel -(Class 11 – ISC)- Solution
Question-wise solution of all Questions of Chapter 12 Depreciation – D.K. Goel -(Class 11 – ISC)- Solutions are shown below: –