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Standard VIII

Mathematics

Formula for CI

M. Raja manuf...

Question

M. Raja manufacturing company purchased on $1 - 1 - 2012$ machinery for Rs. $11, 000$ and spent Rs. $1, 000$ on its installation. Depreciation is to be provided every year at the rate of $20 %$ per annum. Under SLM what will be the Book Value at the end of $2014$ ?

Rs.

9, 600

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Rs.

4800

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Rs.

8, 800

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Rs.

10, 400

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Solution

The correct option is B Rs. $4800$
Cost of amount charged for depreciation = Rs. 11,000 + Rs. 1,000 = Rs. 12,000
Rate of depreciation = 20%
Year Depreciation Book value
2012 = Rs 12,000 x 20% = Rs 2,400
= Rs 12,000 - Rs 2,400 = Rs 9,600
2013 = Rs 12,000 x 20% = Rs 2,400 = Rs 9,600 - Rs 2,400 = Rs 7,200
2014 = Rs 12,000 x 20% = Rs 2,400 = Rs 7,200 - Rs 2,400 = Rs 4,800
Therefore, the book value of the machinery at the end of 2014 is Rs. 4,800.

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Year	Depreciation	Book value
2012	= Rs 12,000 x 20% = Rs 2,400	= Rs 12,000 - Rs 2,400 = Rs 9,600
2013	= Rs 12,000 x 20% = Rs 2,400	= Rs 9,600 - Rs 2,400 = Rs 7,200
2014	= Rs 12,000 x 20% = Rs 2,400	= Rs 7,200 - Rs 2,400 = Rs 4,800

M. Raja manufacturing company purchased on 1−1−2012 machinery for Rs. 11,000 and spent Rs. 1,000 on its installation. Depreciation is to be provided every year at the rate of 20% per annum. Under SLM what will be the Book Value at the end of 2014?

M. Raja manufacturing company purchased on $1 - 1 - 2012$ machinery for Rs. $11, 000$ and spent Rs. $1, 000$ on its installation. Depreciation is to be provided every year at the rate of $20 %$ per annum. Under SLM what will be the Book Value at the end of $2014$ ?