Cost on date of sale can be ascertained only after deducting depreciation from date of purchase till the date of sale after that it is possible to compare between cost on the date of sale and selling price to ascertain profit or loss on sale of the machine.
Return on Total Assets Ratio`=("Profit after Tax ")/(" Total Assets ")xx100 =(" ₹ 50,000 ")/("10,00,00")xx 100 = 5%`
Total Assets = Net Fixed Assets + Current Assets = ₹ 7,50,000...
This statement is True.
Depreciation is charged to profit and Loss A/c as it is an element of Cost. It is also essential to arrive at true value of the asset...
