Multiple choice

Which of the following is not true about straight line method?

  1. It is also known as original cost/fixed installment method.

  2. Depreciation remains same from year to year.

  3. It is generally basis of charging depreciation as per the Income Tax Act.

  4. The residual value of asset becomes zero after certain years.
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

The diminishing balance method is generally applicable in business.

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