Question
A machine costing ₹8,00,000 has a useful life of 5
years and scrap value of ₹50,000. Using WDV method at 30%, what will be the book value at the end of year 2?Solution
Year 1: Depreciation = ₹8,00,000 × 30% = ₹2,40,000; WDV = ₹5,60,000. Year 2: Depreciation = ₹5,60,000 × 30% = ₹1,68,000; WDV = ₹5,60,000 - ₹1,68,000 = ₹3,92,000.
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