A machine costing rupees 240000 is depreciate at 18%per annum on reducing balance method. find the value of the machine after 6years .Also find the value of the machine after 6years. Also find the depreciation amount for the 6th year.
Answers
Given:
A machine costing rupees 240000 is depreciated at 18%per annum on reducing balance method.
To find:
find the value of the machine after 6years. Also, find the depreciation amount for the 6th year.
Solution:
Machine costs = Rs 240000
Depreciate percentage =18%
First-year:
=> 240000 x 18/100 = 43200
=> 240000 - 43200 = 196800
Second-year:
=> 196800 x 18/100 = 35424
=> 196800 - 35424 = 161376
Third-year:
=> 161376 x 18/100 = 29047.68 ( Rounded to 29048)
=> 161376 - 29048 = 132328
Fourth-year:
=> 132328 x 18/100 = 23819.04 (Rounded to 23819)
=> 132328 - 23819 = 108509
Fifth-year:
=> 108509 x 18/100 = 19531.62 (Rounded to 19532)
=> 108509 - 19532 = 88977
Sixth-year:
=> 88977 x 18/100 = 16015.86 (Rounded to 16016)
=> 88977 - 16016 = 72961
Hence, the value of the machine after 6 years is Rs72,961
The depreciation amount for the 6th year is Rs16016