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Straight Line Method(SLM)

According to ...

Question

According to method, the formula of depreciation is $\frac{C o s t o f t h e a s s e t - S c r a p v a l u e}{L i f e o f t h e a s s e t}$

A

straight line

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B

written down value

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C

amortisation

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D

depletion

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Solution

The correct option is A straight line
According to straight line method, the cost of asset after adjusting for scrap value is written off over the life of asset to calculate the value of depreciation.

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Q. The value of an asset is Rs.9,00,000 and scrap value is Rs.1,25,000. If the life of asset is 10 years, then the cost of depreciation is . (SLM Method)

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Q. Original cost of asset : 80,000 scrap value : 10,000 Life of asset : 10 years
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Straight Line Method(SLM)

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