Question : Several methods are used to calculate depreciation of fixed assets of business. What are they?
Option 1: Straight Line method
Option 2: Written down value method
Option 3: Pro-rata Method
Option 4: Both 1 & 2
Correct Answer: Both 1 & 2
Solution :
Depreciation on Assets: There are several ways to figure out how much fixed assets in a corporation have depreciated.
Using a spreadsheet to calculate depreciation depends on the methodology. It can be accomplished either by formula composition or by using an Excel function. Following is a discussion of the methods:
a) The Straight Line Approach This strategy keeps the annual depreciation rate constant.
(a) The method of written-down values This method bases depreciation calculations on the asset's declining value.
Hence the correct answer is option 4.
