Question

The value of machine depreciates at the rate of 20% p.a . It was purchased 2 years ago for Rs40000. What is present value of machine

Answer 1

Answer:

Rate of Depreciation = 20%

Value Depreciated in 1st Year = 20% of 40000

$= \frac{20}{100} \times 40000$

= 8000

Value after 1 yr = 40000 - 8000 = 32000

Value Depreciated in 2nd year = 20% of 32000

$= \frac{20}{100} \times 32000$

= 6400

Present Value = 32000-6400 = ₹25600

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