Question

. An asset is purchased at cost of Rs. 50,000. It has
no salvage value at the end of its life of 10 years.
It's book value calculated by sinking fund method
with 18% interest at the end of 5 years will be​

Answer 1

Answer:

According to straight line method, the amount of yearl -depreciation is calculated as follows:

Depreciation = (Cost of asset - Scrap value) / Estimated life and,

Depreciation = Rs. ( 50000 - 10000 ) / 10

Depreciation = Rs. 4000

Depreciation rate = (Depreciation expense / Cost of asset) * 100

Depreciation rate = (Rs. 4000 / Rs. 50000 ) * 100

Depreciation rate = 8%

if I am wrong then please comment and tell what is the mistake.

please

Thank you