Cost of Machine purchased by Vishal and Co. is Rs.6,20,000 with salvage value Rs.8,000. What will be the amount of depreciation in the second year as according to written down value method. Charge depreciation @ 10% per annum.

Asked by Topperlearning User | 4th Aug, 2016, 01:26: PM

Expert Answer:

 

Depreciation for 1st year

= 6,20,000*10/100

 

= Rs.62,000

Depreciation for 2nd year

= (6,20,000-62,000) *10/100

 

= 5,58,000*10/100

 

= Rs.55,800

 

 

 

Particulars

Amount

Rs. 

Cost of Machine

6,20,000

1st year Depreciation

62,000

WDV after 1st year

5,58,000

2nd year Depreciation (5,58,000*10/100)

55,800

 

5,02,200

 

Answered by  | 4th Aug, 2016, 03:26: PM