A company purchased a building for Rs.50,000. The useful life of the building is 10 years and the residual
value is Rs.2,000. Find out the amount and rate of depreciation under straight line method
Answers
Answered by
20
Explanation:
As per question
Cost of Plant = Rs 50,000
Useful life = 10 years
Residual value = Rs 5000
Depreciation = Cost-Residual value/Estimated useful life
=50,000-5,000/10
=45000/10
=4500
Also,
rate of depreciation = Annual depreciation/cost of plant x 100
= 4500/50,000 x 100
= 9%
Similar questions