Question
Machine cost ₹10L, useful life 5 years, scrap value
₹1L. Using sum-of-years-digits method, depreciation for year 2 = ?Solution
Sum of years = 1+2+3+4+5 = 15. Depreciable amount = 10L - 1L = 9L. Year 2 depreciation = (4/15)×9L = ₹2,40,000 (Remaining life at beginning of year 2 = 4 years).
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