Multiple choice

A machine was being depreciated at 10% as per straight line method. Now, the business decided to depreciate it at the same rate by diminishing balance method with retrospective date. The differences in the amount of depreciation will be

  1. credited to machinery account

  2. debited to machinery account

  3. debited to P and L account

  4. nil
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

The W.D.V. of machine will increase. Thus, it will appreciate. It will be credited to P and L account.

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