Question

A buys a computer for $30,000. He spends $3,000 towards accessories. The rate of depreciation on the total cost of the
computer is 20% p.a. What is his profit/loss on selling the article at $21,120 after three years?
Select one:
O a. 25% profit
Ob. 20% loss
O c. 25% loss
O d. 20% profit​

Answer 1

Answer:

20 percent loss it is,

Step-by-step explanation:

hope it helps

Answer 2

The profit of A  on selling the article at $21,120 after three years is 25% and option (a) is correct.

Step-by-step explanation:

Given:

A buys a computer for $30,000 and spends $3,000 towards accessories.

The rate of depreciation on the total cost of the computer is 20% per annum.

The selling price of  the article at $21,120 after three years.

To Find:

The profit of A   on selling the article at $21,120 after three years.

Solution:

As given- A buys a computer for $30,000 and spends $3,000 towards accessories.

The total cost of the computer = The cost of computer + The cost of computer accessories.

                                                   $= \ 30000+\ 3000 = \ 33000$

As given- The rate of depreciation on the total cost of the computer is 20% per annum.

The  depreciation cost of computer after one year = The total cost of the computer x (1-The rate of depreciation)

                                                      $=\ 33000 \times (1-\frac{20}{100}) = \ 26400$

The  depreciation cost of computer after two years = The depreciation cost of the computer after one year x The rate of depreciation

                                                     $=\ 26400 \times (1-\frac{20}{100}) = \ 21120$

The  depreciation cost of computer after three years = The depreciation l cost of the computer after two years x (1-The rate of depreciation)

                                                     $=\ 21120 \times (1-\frac{20}{100}) = \ 16896$

As given- the selling price of  the article at $21,120 after three years.

Profit =  The selling price of  article after three years - The  depreciation cost of computer after three years

        $= \ 21120 -\ 16896 = \ 4224$

$\% Profit=\frac{Profit}{The\ depreciation\ cost\ of\ computer\ after\ three\ years} \times100$

                $=\frac{\ 4224}{\ 16896} \times100$

                 $=25\%$

Thus, the profit of A  on selling the article at $21,120 after three years is 25% and option (a) is correct.