Question

The cost of a vehicle is Rs. $1,75,000$. If its value depreciates at the rate of $20\%$ per annum, then the total depreciation after $3$ years was _________.

• A. Rs. $86,400$
• B. Rs. $82,500$
• C. Rs. $84,500$
• D. Rs. $85,400$

Answer 1

The correct option is D Rs. $85,400$

Cost of vehicle $=175000$

Depreciation for first year $=\frac{20}{100}\times 175000=35000$

Cost of vehicle after first year $=175000-35000=140000$

Depreciation for second year $=\frac{20}{100}\times 140000=28000$

Cost of vehicle after second year $=140000-28000=112000$

Depreciation for third year $=\frac{20}{100}\times 112000=22400$

Total depreciation after $3$ years $=35000+28000+22400=85400$

Hence, the answer is Rs. $85,400$.