SSC CGL Finance – Capital & Revenue; Depreciation Accounting – Level 1 · Warm-up

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SSC CGL Finance – Capital & Revenue; Depreciation Accounting – Level 1 · Warm-up – 12 questions, subject: Finance & Economics (Tier II Paper III). Every question has the correct answer with a one-line explanation; tap "Show Answer". Free practice for TNPSC, UPSC, SSC, Bank and RRB exams – Shanmugam IAS Academy, Coimbatore.

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1.  
Freight paid on a newly bought machine is:

Correct Answer: C [Capital expenditure]

Explanation:

It is part of the cost of bringing the machine to its place of use.

2.  
Repairs to an existing building that keep it in working order are:

Correct Answer: D [Revenue expenditure]

Explanation:

They maintain, not improve, the asset.

3.  
A loan taken from a bank is a:

Correct Answer: A [Capital receipt]

Explanation:

It must be repaid; it is not income.

4.  
According to AS 10, depreciation is:

Correct Answer: B [The systematic allocation of the depreciable amount of an asset over its useful life]

Explanation:

Answer: The systematic allocation of the depreciable amount of an asset over its useful life. AS 10 definition.

5.  
Which asset is normally NOT depreciated?

Correct Answer: D [Land]

Explanation:

AS 10: land has an unlimited useful life (quarries and landfill sites aside).

6.  
Under the written down value method, the rate is applied to the:

Correct Answer: C [Opening book value of each year]

Explanation:

That is why the charge falls every year.

7.  
Under the straight line method, the annual depreciation is:

Correct Answer: A [The same every year]

Explanation:

(Cost − residual) ÷ life every year.

8.  
The depletion method is most suitable for:

Correct Answer: B [Mines and quarries]

Explanation:

Value falls as the resource is extracted.

9.  
Fill in the blankDepreciable amount = cost − ______.

Correct Answer: C [residual value]

Explanation:

AS 10: cost (or substituted amount) less residual value.

10.  
According to AS 10, depreciation of an asset begins when it is:

Correct Answer: D [Available for use]

Explanation:

Ready to work in the manner intended by management.

11.  
The revaluation method of depreciation is commonly used for:

Correct Answer: A [Loose tools]

Explanation:

Many small items are simply valued at the year-end.

12.  
Profit on the sale of a fixed asset is a:

Correct Answer: B [Capital profit]

Explanation:

It arises from the disposal of a capital asset; AS 10 says such gains are not revenue.

➤ Full notes, shortcuts and every answer explained – SSC CGL 2026 Finance & Economics (Tier II Paper III) book (₹149): www.shanmugamiasacademy.in/study-materials/ssc-cgl-finance-economics

📘 SSC CGL 2026 – General Studies – Finance & Economics (Tier II Paper III)
Here you get the answer with a one-line explanation. 1,064 original questions with worked answers · Part A Finance & Accounts and Part B Economics & Governance notes · practice sets + 3 mock tests
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