[amp_mcq option1=”Plant & Machinery” option2=”Building account” option3=”Land” option4=”Equipment’s” correct=”option3″]
The correct answer is C. Land.
Land is not depreciated in the ordinary circumstances because it is considered to have an unlimited life. This means that it is not expected to lose its value over time.
Plant and machinery, building accounts, and equipment are all depreciable assets. This means that they are expected to lose their value over time due to wear and tear, obsolescence, or other factors. The cost of these assets is therefore spread out over their useful life, which is the period of time that they are expected to be used.
Land, on the other hand, is not expected to lose its value over time. This is because land is a natural resource that is not subject to wear and tear. It is also not subject to obsolescence, as it is not a product that becomes outdated. As a result, land is not depreciated in the ordinary circumstances.
However, there are some circumstances in which land may be depreciated. For example, if land is used for a specific purpose, such as a mine or quarry, then it may be depreciated over the period of time that it is used for that purpose. Additionally, if land is purchased for a speculative purpose, such as to hold for future development, then it may be depreciated over the period of time that it is held for that purpose.