Question

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4
7) A bike purchased for Rs.30000.its life
is 30 years and salvage value is 10%,
calculate annual depreciation by straight
line method. Calculate book value at 4
years. (3 marks)​

Answer 1

Step-by-step explanation:

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%