Question

A purchased a mine for Rs. 2,50,000 minerals in the mine were expected to be 5,00,000 tonnes. In the first year 50,000 tonnes of minerals were used. What is the depreciation for the first year_______.

• A. Rs. 20,000
• B. Rs. 25,000
• C. R5. 30,000
• D. Rs. 35,000

Answer 1

Answer: (B)

Rs. 25,000

Depreciation = Depreciable value x production units

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total production

= 2,50,000 x 50,000 tonnes

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5,00,0000

= RS- 25,000.