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    • Question

      ABC ltd purchased a machine for ₹20,000. After a

      period of 5 years, the accumulated depreciation charged on the machine is ₹4,000. However, due to a boom in the market, the current market value of the machine is ₹26,000. At what value should the machine be recorded in the books of accounts and because of which accounting concept?
      A ₹22,000; Matching Concept Correct Answer Incorrect Answer
      B ₹20,000; Historical Cost Concept Correct Answer Incorrect Answer
      C ₹16,000; Historical Cost Concept Correct Answer Incorrect Answer
      D ₹26,000; Matching Concept Correct Answer Incorrect Answer

      Solution

      The correct answer is C

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