Question

An asset coasting 100000 was estimated to have a useful life of 8 years and a residual value of 20000 after 2 years the useful life was revised to 5 years calculate the depreciation change for the year 1,2 and 3 as per accounting system 10

Answer 1

Answer:

Correct option is

C

Rs. 1,620

Calculation of depreciation of asset of Rs. 20000 @ 10% per annum by reducing balance method:

Amount (Rs.)

Book value of asset in 1st year 20000

Less: Depreciation @ 10% (2000)

Written down Value of Asset in 2nd year 18000

Less: Depreciation @ 10% (1800)

Written down Value of Asset in 3rd year 16200

Depreciation @ 10% in 3rd year = Rs. (16200 * 10)/100 = Rs. 1620