Question
A company buys machinery for ₹10 lakh on April 1, has
the useful life of 8 years and salvage value of ₹1lakh. Depreciation is charged at 15% WDV. What is the value of the machinery at the end of the 3rd year (rounded off)?Solution
WDV Method: Year 1: ₹10,00,000 – 15% = ₹8,50,000 Year 2: ₹8,50,000 – 15% = ₹7,22,500 Year 3: ₹7,22,500 – 15% ≈ ₹6,14,125 Rounded off ≈ ₹6.12 lakh
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