a building purchased on 1st January 2013 at rupees 1500000 having useful life of 15 years was depreciated on straight line basis on 1st January 2016 the same building was devalued acquired by rupees 3 lacs the revised amount of depreciation for the year 2016 will be
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Building cost = 1500000
depreciation for the year 2013 = 1500000/15
= 100000/year
accumulated depreciation up to year 2015 = 100000×3
= 300000
carrying value of building 2015 = 1500000-300000
= 1200000
Revised amount of building = 1200000-300000
Revised amount of building = 900000
Remaining life of building on 1.1.2016 = 15-3 = 12
Depreciation for 2016 = 900000/12
Depreciation for 2016 =75000
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