For the depreciation of machinery, relation between Principal (P) and Amount
(A) is ----.
Answers
Answer:
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A = P where A is the final amount, P is the principal, r is the rate of interest compounded ... (iii) the difference between the C.I. and S.I. for 3 years. ... Original value of machine = Rs 20000,
Step-by-step explanation:
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Given : For the depreciation of machinery,
To Find : relation between Principal (P) and Amount A
a) P < A b) P = A c) P > A
Solution:
relation between Principal (P) and Amount A
A = P ( 1 + r/100)ⁿ
where P is principal
A = amount after n years
r = rate of change
r +ve for appreciation
r = - ve for depreciation
r = 0 for no change
r +ve for appreciation
A = P ( 1 + r/100)ⁿ
1 + r/100 > 1 => ( 1 + r/100)ⁿ > 1
Hence A > P
r -ve for depreciation
A = P ( 1 + r/100)ⁿ
1 + r/100 < 1 => ( 1 + r/100)ⁿ < 1
Hence A < P
=> P > A
for r = 0
A = P (1)ⁿ = P
Hence For the depreciation of machinery, relation between Principal (P) and Amount is P > A
Depreciation mean a reduction in the value of an asset overtime.
It is a non-cash expense that reduces the price of an asset.
As time passes, the asset losses it's value known as "Depreciation".
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