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Straight Line Method(SLM)

A car was pur...

Question

A car was purchased for Rs. 55,000.
Its residual value was estimated to be Rs. 5,000 with useful life of 5 years.
What will be the depreciation expense?

A

Rs. 12,000

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B

Rs. 11,000

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C

Rs. 10,000

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D

Rs. 6,000

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Solution

The correct option is C
Rs. 10,000

Depreciation
= (Rs. 55,000 - Rs. 5,000) / 5
= Rs. 10,000

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