According to IAS 16 Property, Plant and Equipment, which, if any, of the following statements about depreciation are correct? The main purpose of depreciation is to reflect the fall in value of an asset over its useful lifeWhen an asset is revalued, subsequent depreciation relating to the amount of the revaluation should be debited to the revaluation surplus rather than to the income statementThe provision for depreciation ensures that there are funds available to replace an asset when this becomes necessary, though in times of inflation, additional amounts may need to be set asideA change in depreciation method constitutes a change in accounting policy and must be accounted for as such

IAS 16 Property, Plant and Equipment it is an standard and this accounting treatment is totally…

Answered: According to IAS 16 Property, Plant and…

Accounting Information Systems

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ISBN:9781337619202

Author:Hall, James A.

Publisher:Hall, James A.

Chapter6: The Expenditure Cycle Part Ii: Payroll Processing And Fixed Asset Procedures

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Problem 8MCQ: All of the following data items are likely to be included in a fixed asset record except: a....

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According to IAS 16 Property, Plant and Equipment, which, if any, of the following statements about depreciation are correct?

The main purpose of depreciation is to reflect the fall in value of an asset over its useful life
When an asset is revalued, subsequent depreciation relating to the amount of the revaluation should be debited to the revaluation surplus rather than to the income statement
The provision for depreciation ensures that there are funds available to replace an asset when this becomes necessary, though in times of inflation, additional amounts may need to be set aside
A change in depreciation method constitutes a change in accounting policy and must be accounted for as such

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