Question

purchased machinery for $100000
Rate of depriciation - 15% p.a.
Calculate depriciation by fixed installment method.
The books are closed on 31st
december every year.​

Answer 1

Answer:

100000 × 15 / 100 = 15000

Answer 2

Answer:

Depreciation = 15000

Explanation:

★Given :

• Cost of machinery = ₹ 1,00,000

• Rate of Depreciation = 15 %

★To find Depreciation :

⟶ Cost of Machinery × rate / 100

⟶ 1,00,000 × 15 / 100

⟶ 15,00,000 / 100

⟶ 15000

∴ Depreciation = 15000

★Fixed Installment method :

This is a method in which a fixed amount is deducted from the value of an asset year after year on account of depreciation and debited to profit and loss a/c. It is also called Straight line Method or Original Cost method. Because depreciation is charged every year is Uniform and is calculated on the original Cost of the Assets.

Depreciation = Original Cost-scrap Value

--------------------------------------

estimated life

Note :

( ----- ) = Division