Target Exam

CUET

Subject

-- Accountancy Part C

Chapter

Use of Spreadsheet in Business Applications

Question:

Which value will become the base in the Written Down Value (WDV) for computing the depreciation for the next period?

Options:

Current book value

Purchase price

Acquisition cost

Salvage value

Correct Answer:

Current book value

Explanation:

The correct answer is option 1- Current book value.

Written Down Value (WDV) method uses the current book value as the base for computing the depreciation for the next period. It is also called Declining Balance (DB) method and uses the Excel function DB to compute the depreciation.