Give three points of difference between Straight line and Diminishing Balance Method of charging Depreciation.

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answered Mar 8, 2019 by Rabia (87.4k points)
selected Mar 8, 2019 by faiz

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Meaning	A method of depreciation in which the cost of the asset is spread uniformly over the life years by writing off a fixed amount every year.	A method of depreciation in which a fixed rate of depreciation is charged on the book value of the asset, over its useful life.
Calculation of depreciation	On the original cost	On the written down value of the asset.
Annual depreciation charge	Remains fixed during the useful life.	Reduces every year
Value of asset	Completely written off	Not completely written off
Amount of depreciation	Initially lower	Initially higher
Impact of repairs and depreciation on P&L A/c	Increasing trend	Remains constant