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 In the year 2004-2005, C Ltd. purchased a new machine and made the following payments in relation to it:
If depreciation is provided @ 10%p.a. WDV, depreciation for 3rd year is
  • a)
    Rs. 43,740
  • b)
    Rs. 44,145
  • c)
    Rs. 38,070
  • d)
    Rs.44,550
Correct answer is 'A'. Can you explain this answer?
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Most Upvoted Answer
In the year 2004-2005, C Ltd. purchased a new machine and made the fol...
Total cost =470000+10000+20000+40000=540000
1st year dep 540000*10/100=54000 2nd year dep =486000*10/100= 48600 3rd year dep =437400*10/100= 43740 so ans would be a
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In the year 2004-2005, C Ltd. purchased a new machine and made the fol...
Depreciation Calculation (WDV Method)
Step 1: Calculate the Total Cost of the Machine
The total cost includes all expenses necessary to bring the machine into working condition, excluding recurring charges like annual maintenance and insurance premiums.
  • Cost after discount: ₹4,70,000
  • Add delivery charges: ₹10,000
  • Add erection charges: ₹20,000
  • Add cost of additional components: ₹40,000
Total Cost for Depreciation: ₹4,70,000 + ₹10,000 + ₹20,000 + ₹40,000 = ₹5,40,000
Step 2: Depreciation Calculation Using WDV
First Year:
Depreciation 1st Year: ₹5,40,000 × 10% = ₹54,000
WDV after 1st Year: ₹5,40,000 − ₹54,000 = ₹4,86,000
Second Year:
Depreciation 2nd Year: ₹4,86,000 × 10% = ₹48,600
WDV after 2nd Year: ₹4,86,000 − ₹48,600 = ₹4,37,400
Third Year:
Depreciation 3rd Year: ₹4,37,400 × 10% = ₹43,740
The depreciation for the 3rd year under the WDV method is ₹43,740.
Correct Option: (a) ₹43,740
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On 01.01.2001, a new plant was purchased by Mrs. Shweta Periwal for Rs 1,00,000 and a further sum of Rs 5,000 was spent on installation. On 01.06.2002, another plant was acquired for Rs 65,000. On 02.10.2003, the first plant was totally destroyed and the amount of Rs 2,500 only was realized by selling the scraps. It was not insured. On 20.10.2003, a second hand plant was purchased for Rs 75,000 and a further sum of Rs 7,500 was spent for repairs and Rs 2,500 on its erection. It came into use on 15.11.2003. Depreciation has been provided @ 10% on the original cost annually on 31st December. It was the practice to provide depreciation for full year on all acquisitions made at any time during the year and to ignore the depreciation on any time sold during the year.In December 2003, it is decided to change the method of depreciation and to follow the rate of 15% on diminishing balance method with retrospective effect in respect of the existing items of plant and to make necessary adjustments on 31.12.2003.Q.Depreciation over / under charged = _________.

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In the year 2004-2005, C Ltd. purchased a new machine and made the following payments in relation to it:If depreciation is provided @ 10%p.a. WDV, depreciation for 3rd year isa)Rs. 43,740b)Rs. 44,145c)Rs. 38,070d)Rs.44,550Correct answer is 'A'. Can you explain this answer?
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In the year 2004-2005, C Ltd. purchased a new machine and made the following payments in relation to it:If depreciation is provided @ 10%p.a. WDV, depreciation for 3rd year isa)Rs. 43,740b)Rs. 44,145c)Rs. 38,070d)Rs.44,550Correct answer is 'A'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about In the year 2004-2005, C Ltd. purchased a new machine and made the following payments in relation to it:If depreciation is provided @ 10%p.a. WDV, depreciation for 3rd year isa)Rs. 43,740b)Rs. 44,145c)Rs. 38,070d)Rs.44,550Correct answer is 'A'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for In the year 2004-2005, C Ltd. purchased a new machine and made the following payments in relation to it:If depreciation is provided @ 10%p.a. WDV, depreciation for 3rd year isa)Rs. 43,740b)Rs. 44,145c)Rs. 38,070d)Rs.44,550Correct answer is 'A'. Can you explain this answer?.
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