Basic query in accounting

This query is : Resolved

pavankumar (Querist)
Follow

14 October 2013 Which option from below is correct?
Machinery acquired on 1-4-2006 for Rs 5,00,000
Estimated working life =10 years
Scrap value =Rs 50,000
What is Rate of Depreciation(Under Straight line method)?

Ans:
Depreciation Amt= = Rs 5,00,000----50,000
10 years
= Rs45,000 p.a
Rate of Depreciation
Option I
= 45,000 X100 =9%
5,00,000

Option II
= 45,000 X100 =10%
4,50,000

I will be very much thankful to you.

Ganeshbabu K

Ganeshbabu K (Expert)
Follow

27 October 2013 option I is correc
.
.
in slm method depreciation has to be caluculated on cost every year
.
.
hence we can depreciate for 450000 if we take 9% as dep.rate

Message likes : 1 times

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now

Summarize this with AI

ChatGPT Perplexity Claude Google AI Grok