Question

An asset is purchased for p 9000.00. its estimated economic life is 10 years after which it will be sold for 1000.00. find the depreciation in first three years using sum-of-years digit method​

Answer 1

Explanation:

in case of sum of year of digit method, for calculating depreciation, we have to reduce scrap value from cost of machinery and then divide whole by sum of expectated no. of years of machinery. At last answer is multiplied by reverse of no. of years