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)

Rs.65,000

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Rs.89,000

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Rs.77,500

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Rs.78,000

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Solution

The correct option is C Rs.77,500
Depreciation

= $\frac{C o s t o f t h e a s s e t - S c r a p v a l u e}{L i f e o f t h e a s s e t}$

= $\frac{9, 00, 000 - 1, 25, 000}{10}$

=Rs.77,500

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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)

The correct option is C Rs.77,500 Depreciation = Cost of the asset − Scrap valueLife of the asset = 9,00,000 − 1,25,00010 =Rs.77,500

The correct option is C Rs.77,500
Depreciation

= $\frac{C o s t o f t h e a s s e t - S c r a p v a l u e}{L i f e o f t h e a s s e t}$

= $\frac{9, 00, 000 - 1, 25, 000}{10}$

=Rs.77,500