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WAEC Financial Accounting 2020 Question 50

Question 50

Depreciation

A method of charging depreciation at a fixed percentage of the net book value is

  1. A.straight line method.
  2. B.reducing balance method.
  3. C.sum of the years' digits method.
  4. D.revaluation method.
Show the answer and explanation

Answer: B (reducing balance method.)

Explanation

Reducing balance applies a fixed rate to the net book value each year.