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Question

A new machine costing Rs $$1,00,000$$ was purchased by a company on 1st April, 2011. The useful life is estimated to be 5 years and scrap value at Rs $$10,000$$. The production hours for the next 5 years is as follows:
YearHours
2011-2012$$5,000$$
2012-2013$$10,000$$
2013-2014$$12,000$$
2014-2015$$20,000$$
2015-2016$$25,000$$
Find the depreciation for year 2013-2014 ?


A
25,000
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B
15,000
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C
12,500
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D
6,250
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Solution

The correct option is B $$15,000$$
Depreciation for the year 2013-2014 can be calculated by :
             Depreciable value * Avg production hours/ Total production hours

              =  90000*12000/72   =   15000
  • Depreciable value 100000-10000 = 90000
  • Total production hours( 5000+10000+12000+20000+25000) = 72000
  • Avg Production hrs = 72000/5 = 12000


Accountancy

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