Identify whether each of the following statements is true or false by placing a tick in column

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Identify whether each of the following statements is true or false by placing a tick in column X if true and column Y if false:

(a) By depreciation an entity sets aside cash resources which will be readily available to pay for replacement of assets in use

(b) Depreciation is no more than an allocation of depreciable cost in a systematic manner over the estimated economic life of the asset

(c) Factors to be considered when determining the depreciation charge are:

(i) The cost of the asset

(ii) The residual value (also known as scrap value or salvage value)

(iii) The method of depreciation in use

(iv) The amount at which the asset is insured

(v) Expenses to keep the asset in a working condition

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Related Book For  book-img-for-question

Financial Accounting An Introduction

ISBN: 9780273737650

2nd Edition

Authors: Mr Barry Elliott, Mr Augustine Benedict

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