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How to solve this

nidhi (student) (346 Points)

11 January 2015

Original cost-100000 Scrap value-5000 Useful life-6 yrs Rate-? Formula given to find the rate: {1-[(scrapvalue/originalcost)^1/n]} how to get the rate ? pls help

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Sanat Biswal (Chartered Accountant) (1139 Points)
Replied 11 January 2015

Originally posted by : nidhi
	Original cost-100000 Scrap value-5000 Useful life-6 yrs Rate-? Formula given to find the rate: {1-[(scrapvalue/originalcost)^1/n]} how to get the rate ? pls help

https://www.mathwarehouse.com/arithmetic/principal-nth-root-calculator.php

follow this link you can find the answer.

The rate will come to 1%.

nidhi (student) (346 Points)
Replied 11 January 2015

The rate is 39.30%..

nidhi (student) (346 Points)
Replied 11 January 2015

The rate is 39.30%..

Sanat Biswal (Chartered Accountant) (1139 Points)
Replied 11 January 2015

Originally posted by : nidhi
	The rate is 39.30%..

Yup u r right,the rate is 39.30%.You are right..just made a miscaculation.Sorry for that....

Rohit Pandey (Student) (766 Points)
Replied 11 January 2015

As per your question, Formula for calculating depreciation rate is:

$\mbox{depreciation rate} = 1 - \sqrt[N]{\mbox{residual value} \over \mbox{cost of fixed asset}}$

Residual Value = Rs. 5000

Cost of Fixed Asset = Rs. 100000

N = 6

So, we have to calculate 6th root of 5000/100000 i.e. 0.05

Step 1

Press ROOT button twelve times.

Resulting figure: 0.99926888743

Step 2

Deduct 1 from Resulting figure in Step 1

Resulting figure: -0.00073111257

Step 3

Divide Resuting figure in Step 2 by 6 (Six)

Resulting figure: -0.00012185209

Step 4

Add 1 to resulting figure in Step 3

Resuting figure: 0.99987814791

Step 5

Now, press 'x' and then '=' in combination, 12 (Twelve) times

Resulting Figure: 0.6070545673

Step 6

Now as per formula of calculating depreciation rate

$\mbox{depreciation rate} = 1 - \sqrt[N]{\mbox{residual value} \over \mbox{cost of fixed asset}}$

Deduct resulting figure in Step 5 from 1 (One)

{You may put resulting figure in Step 5 in 'M-' and Then, press 1 and put it in 'M+'. Then press 'MR' button. You will get answer by this.)

ANSWER: 0.3929454327 OR 39.30% approx

Rohit Pandey (Student) (766 Points)
Replied 11 January 2015

Dear Ms. Nidhi,

This question motivated me to write an article tilted as 'Calculator Trick - Helping in your acedemics' It will be uploaded soon. Thank you for being my motivation. Hope you have got solution for your question. For further clarification(s), you may contact me.

Regards,

Rohit Pandey