Accounting · Depreciation and Component Accounting

Consider the following statements regarding depreciation and accounting standards: Statement 1: Depreciation is a process of valuation of an asset to ensure that the balance sheet reflects the current market price of the fixed assets. Statement 2: The main objective of providing depreciation is to calculate the true profit of the business by matching the cost of the asset's usage against the revenue it helps to generate. Statement 3: Depreciation is provided only on assets expected to be used for more than one accounting period and having a limited useful life. Statement 4: According to the Companies Act 2013, if a component of an asset has a significant cost relative to the total cost, it must be depreciated separately (Component Accounting). Statement 5: The choice of depreciation method should be followed consistently from year to year to ensure comparability. Statement 6: If an asset's recoverable amount falls below its carrying amount, an impairment loss must be recognized, distinct from regular depreciation. Statement 7: Depreciation is a 'non-cash' expense, meaning it does not involve an actual outflow of cash. Which of the following choices is true?