Question
Under which method of Depreciation, the written down
value of the asset is always more than zero:Solution
Under the written down value (WDV) method of depreciation, the WDV of the asset is always more than zero. The WDV of an asset is the value of the asset after deducting the accumulated depreciation from its original cost. Under the WDV method, depreciation is charged at a fixed percentage on the WDV of the asset each year, which means that the WDV will decrease each year. However, the WDV can never be zero or less than zero because the asset still has some value, even if it has been fully depreciated.
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