Advertisements
Advertisements
प्रश्न
A company purchased a building for ₹ 50,000. The useful life of the building is 10 years and the residual value is ₹ 5,000. Find out the amount and rate of depreciation under the straight-line method.
Advertisements
उत्तर
Calculation of the amount of depreciation:
Original cost = ₹ 50,000
residual value = ₹ 5,000
Estimated life = 10 years
Amount of depreciation = `("Original cost" - "Scrap value")/"Estimates life"`
= `(50,000 - 5,000)/(10 "years")`
= `(45,000)/10`
= ₹ 4,500
Calculation of rate of depreciation:
Rate of depreciation = `"Amount of depreciaton"/"Original cost" xx 100`
`= (4,500)/(50,000) xx 100`
= 9 %
APPEARS IN
संबंधित प्रश्न
List out the various methods of depreciation.
What is the annuity method?
State the advantages of written down value method of depreciation.
Distinguish between straight-line method and written down value method of providing depreciation.
A boiler was purchased on 1st January 2015 from abroad for ₹ 10,000. Shipping and forwarding charges amounted to 12,000. Import duty ₹ 7,000 and expenses of installation amounted to ₹ 1,000. Calculate depreciation for the first 3 years @10% p.a. on diminishing balance method assuming that the accounts are dosed 31st December each year.
On 1st April 2015, Farid of Nasik purchased a Motor Car for ₹ 55,000. The scrap value of the Motor Car was estimated at ₹ 10,000 and its estimated life is 10 years. The Registration charge for the Motor Car was ₹ 5,000.
Show Motor Car Account for first four years, assuming that the books of accounts are closed on 31st March every year.
On 1st April 2015, Farid of Nasik purchased a Motor Car for ₹ 55,000. The scrap value of the Motor Car was estimated at ₹ 10,000 and its estimated life is 10 years. The Registration charges of the Motor Car was ₹ 5,000.
Show Motor Car Account for first four years, assuming that the books of accounts are closed on 31st March every year.
Which depreciation method helps a firm accumulate funds for replacing an asset after its useful life?
Under which method might two identical machines purchased at the same cost show different depreciation expenses in two companies?
The Double Declining Balance Method applies depreciation:
