The cost of a machine is Rs. $2, 000$ . Two years later the book value is Rs. $1, 000$ . The straight-line percentage depreciation is _________.

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Solution

The correct option is C $25$ %
Under straight line method of depreciation, an equal amount is written off every yesr during the working life of an asset so as to reduce the cost of thee asset to nil or its residual value at the end of its useful life.
Under this method, the amount of depreciation is constant throughout the useful life of the asset.
Hence, in the above question :
Cost of machine = Rs. 2000
Book value after 2 years = Rs. 1000
Depreciation for two years = Rs. 1000
Depreciation for 1 year = Rs 1000 /2 = Rs. 500
SLM depreciation rate = (Straight Line Depreciation/Cost of asset) * 100
SLM depreciation rate = (Rs.500/Rs. 2000) * 100
SLM depreciation rate = 25%

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The cost of a machine is Rs. 2,000. Two years later the book value is Rs. 1,000. The straight-line percentage depreciation is _________.

The cost of a machine is Rs. $2, 000$ . Two years later the book value is Rs. $1, 000$ . The straight-line percentage depreciation is _________.