Question

The value of a machine depreciates every year by 10% what will be its value after 2 years if present value is rs 50000

Answer 1

value = 50000 (1-10/100)² = 50000×0.81  = 40500

Answer 2

there are many methods to find depericiation..
but i knw 2 methods

first is dimnishing value method..
here the solution by by this method

50000*10/100=5000
so depriciation value is 5000
and now machinery value is 50000-5000= 45000
and in second year the depriciation done on that depriciated value ie. 45000
so 10% depriciation on 45000 is 4500
so now machinery value is 45000-4500=
40500

and now by second. method also we can find depriciation
second method is straight line value method..

present value of asset is. 50000
so in this method we depreciate maxhinery by same value..each year
like this

on first year 50000*10/100 = 5000

on second year we delriciate machinery by their old value 50000*10/100 = 5000


the. only difference is that
in straight line value method we depreciate assets by same value we depricate on first year

and on second method we depreciate by different value. every year