Depreciation

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Dhananjay Singh

Dhananjay Singh (Querist)
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11 January 2014 please tell me about SLM and WDV method of depreciatio when we use slm method WDV vice versa

Sanket

Sanket (Expert)
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11 January 2014 In Written Down Value (WDV) method
depreciation is charged on the reuced
price. Example: Asset purchased for Rs.
100.00: Depreciation rate 10%. First year
its value will be reduced to 90.00
(100-10% of 100) and in second year
depreciation will be Rs. 9.00 i e 10% of
90. Similarly third year it will be Rs.
8.10. This way the value of asset never
comes at Zero.

Sanket

Sanket (Expert)
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11 January 2014 In Straight Line Method (SLN) life of a
asset is known then for the duration of
life ever year an equal sum is taken as
depreciation. Example Asset purchased
for Rs. 100.00 Life ascertained 8 years
and then every year a sum of Rs. 12.50
is charged to Depreciation and after 8th
year its book value will be zero.
WDV method is strongly recommended.

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