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if the opening written down value of a machine is 500000 find the value of depreciation at 10% for the current year |
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Answer» Explanation: It is given that PRESENT value = 500000 REDUCED value = 364500 Rate of depreciation = 10% p.a. Consider N YEARS as the period We know that A/P = (1−r/100) n
Substituting the VALUES 364500/500000=(1−10/100) n
By further calculation (9/10) n =729/1000=(9/10) 3
So we get n=3 Therefore, the period in which its value be reduced to 364500 is 3 years. |
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