Question

$ 40,000 appreciated @ 7% each year .Calculate the value of the land after 2 years.

Answer 1

Step-by-step explanation:

Value of asset at the end of 2nd year = value at the end of 3rd year x 100/90

= 36,450 x 100/90

= RS-40,500.

Value of asset at the end of 1st year = value at the end of 2nd year x 100/90

= 40,500 x 100/90

= RS-45,000.

Original value = Value at the end of 1st year x 100/90

= 45,000 x 100/90

= RS-50,000.