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    Question

    A machine was purchased for ₹1,00,000. Depreciation is

    charged at 10% per annum under the Diminishing Balance Method. The book value of the machine at the end of the second year will be:
    A ₹80,000 Correct Answer Incorrect Answer
    B ₹81,000 Correct Answer Incorrect Answer
    C ₹90,000 Correct Answer Incorrect Answer
    D ₹19,000 Correct Answer Incorrect Answer

    Solution

    Year 1 Depreciation: 10% of ₹1,00,000 = ₹10,000. Book Value at year-end: ₹90,000. Year 2 Depreciation: 10% of ₹90,000 = ₹9,000. Book Value at year-end: ₹81,000.

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