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.Management Sciences
A. Calculate the true profit
B. Show the true financial position in the Balance Sheet
C. Provide funds for replacement of fixed assets
D. Both A. and B. above
The main objective of providing depreciation is to find out the true Net Profit or Loss for
an accounting period and to present a true and fair view of the state of affairs of the business.
Providing funds for replacement is only an ancillary objective and not the main objective.]
Related Mcqs:
- If debit balances = credit balances, trial balance only shows or check the ____________ and it does not indicate that no errors were made during recording and posting.
- A. Arithmetic accuracy B. Errors of commission C. Omissions of economic events D. Understatements of balances...
- An asset must be _______ by the business to be shown as an asset in its “balance sheet”
- A. Possessed B. Owned C. Controlled D. Used...
- Which of the following is not a contingent liability?
- A. Debts included in Sundry Debtors which are doubtful in nature B. Uncalled liability on partly paid shares C. Claims against the company not acknowledged as debts D. Arrears of fixed cumulative dividend...
- A foreign bill of exchange is generally drawn up in___________?
- A. Triplicate B. Duplicate C. Single D. Quadruplicate...
- Costs that change in response to alternative courses of action are called___________?
- A. Relevant costs B. Differential costs C. Target costs D. Sunk costs...
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