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    Question

    In relation to the Accounts of Electricity Companies,

    which of the following points are involved in the Optimised Depreciated Replacement Cost [ODRC] Method? (i) Assessing the gross current replacement cost of modern equivalent assets (ii) Making an adjustment for over design, over capacity and redundant assets (iii) Depreciating this optimum gross current replacement cost to reflect the anticipated effective working life of the asset from new, the age of the asset and the estimated residual value at the end of the asset’s working life
    A Only (ii) and (iii) Correct Answer Incorrect Answer
    B Only (i) and (ii) Correct Answer Incorrect Answer
    C Only (i) and (iii) Correct Answer Incorrect Answer
    D (i), (ii) and (iii) Correct Answer Incorrect Answer

    Solution

    The correct answer is D

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