Question

The cost price of a machine is ₹2,00,000 . If the rate of depreciation is 25% per year , find the depreciation in price of the machine after two years.​

Answer 1

Given:

A machine:-

• Cost Price (Principal) = Rs. 2,00,000
• Rate of depreciation = 25%
• Time = 2 years

What To Do:

Find the depreciation of the price of the machine (amount) after two years.​

Formula:

$\sf{Amount = P \bigg(1 - \dfrac{R}{100} \bigg) ^T}$

Solution:

Using the formula,

⇒ $\sf{Amount = P \bigg(1 - \dfrac{R}{100} \bigg) ^T}$

Substitute the values,

⇒ $\sf{Amount = 200000 \bigg(1 - \dfrac{25}{100} \bigg) ^2}$

Solve the brackets,

⇒ $\sf{Amount = 200000 \bigg( \dfrac{75}{100} \bigg) ^2}$

Remove the brackets,

⇒ $\sf{Amount = 200000 \times \dfrac{75}{100} \times \dfrac{75}{100}}$

Cancel the zeros,

⇒ $\sf{Amount = 20 \times 75 \times 75}$

Multiply the numbers,

⇒ Amount = Rs. 1,12,500

∴ Thus, the depreciation in the price of the machine after two years is Rs. 1,12,500.