PRC-1 · Chapter 6 · Question 92 of 100
If an asset is revalued upwards, how does this typically affect the subsequent annual depreciation charge?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) It will increase.
Explanation
An upward revaluation increases the carrying amount (the depreciable base). Consequently, spreading a larger amount over the remaining useful life will result in a higher annual depreciation charge.
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