Question

The W.D.V. of an asset after three years of depreciation on reducing balance method @ 10% p.a. is Rs. 65610. What was its original value ?
(a) 47829
(b) 80,000
(c) 90,000
(d) 100,000
how to solve it tell me guys please​

Answer 1

Answer:

(c) 90,000

Explanation:

Given :-

The W.D.V. (Written-Down Value) of an asset after three years of depreciation on reducing balance method @10% p.a. is Rs. 65610.

To Find :-

The original value of an asset.

Solution :-

We know that,

Total is 100%.

According to the question,

Every year we depreciate 10% so the remaining is 90%.

Given,

Value of an asset at the end of third year = Rs. 65610.

Value of an asset at the end of second year = Value of an asset at the end of third year*100/90.

=> 65,610*100/90

=> 72,900

So, the value of an asset at the end of the second year = Rs. 72,900.

Similarly,

Value of an asset at the end of first year = Value of an asset at the end of second year*100/90.

=> 72,900*100/90

=> 81,000

So, the value of an asset at the end of the first year = Rs. 81,000.

Now,

Original Value = Value of an asset at the end of first year*100/90.

=> 81,000*100/90

=> 90,000

Hence,

The original value of an asset is Rs. 90,000.

So, the correct option is (c) 90,000.