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On August 01,2013, k travels ltd.bought four matador vans costing 1,20,000/- each.The company expected to fetch a scrap value of 25% of the cost price of the vechicles after ten years.The vehicles were depreciated under the fixed instalment method up to march 31,2016.The rate of depreciation charged up to march 31,2016 was a)10.0% b)9.0% c)8.5% d)7.5%?
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On August 01,2013, k travels ltd.bought four matador vans costing 1,20...
Depreciation Calculation
The given problem requires the calculation of the rate of depreciation charged up to March 31, 2016, using the fixed installment method. The following steps are involved in the calculation:
Step 1: Calculation of Depreciation Amount
The depreciation amount is calculated by subtracting the expected scrap value from the cost price of the vehicle and dividing it by the useful life of the vehicle. The formula for depreciation amount is:
Depreciation Amount = (Cost Price – Scrap Value) / Useful Life
Substituting the given values, we get:
Depreciation Amount = (1,20,000 – (0.25 x 1,20,000)) / 10
Depreciation Amount = 90,000 / 10
Depreciation Amount = 9,000
Therefore, the annual depreciation amount for each vehicle is Rs. 9,000.
Step 2: Calculation of Depreciation Rate
The depreciation rate is calculated by dividing the annual depreciation amount by the cost price of the vehicle and multiplying it by 100. The formula for depreciation rate is:
Depreciation Rate = (Annual Depreciation Amount / Cost Price) x 100
Substituting the given values, we get:
Depreciation Rate = (9,000 / 1,20,000) x 100
Depreciation Rate = 7.5%
Therefore, the rate of depreciation charged up to March 31, 2016, using the fixed installment method is 7.5%.
Answer: d) 7.5%
The given problem requires the calculation of the rate of depreciation charged up to March 31, 2016, using the fixed installment method. The following steps are involved in the calculation:
Step 1: Calculation of Depreciation Amount
The depreciation amount is calculated by subtracting the expected scrap value from the cost price of the vehicle and dividing it by the useful life of the vehicle. The formula for depreciation amount is:
Depreciation Amount = (Cost Price – Scrap Value) / Useful Life
Substituting the given values, we get:
Depreciation Amount = (1,20,000 – (0.25 x 1,20,000)) / 10
Depreciation Amount = 90,000 / 10
Depreciation Amount = 9,000
Therefore, the annual depreciation amount for each vehicle is Rs. 9,000.
Step 2: Calculation of Depreciation Rate
The depreciation rate is calculated by dividing the annual depreciation amount by the cost price of the vehicle and multiplying it by 100. The formula for depreciation rate is:
Depreciation Rate = (Annual Depreciation Amount / Cost Price) x 100
Substituting the given values, we get:
Depreciation Rate = (9,000 / 1,20,000) x 100
Depreciation Rate = 7.5%
Therefore, the rate of depreciation charged up to March 31, 2016, using the fixed installment method is 7.5%.
Answer: d) 7.5%
Community Answer
On August 01,2013, k travels ltd.bought four matador vans costing 1,20...
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On August 01,2013, k travels ltd.bought four matador vans costing 1,20,000/- each.The company expected to fetch a scrap value of 25% of the cost price of the vechicles after ten years.The vehicles were depreciated under the fixed instalment method up to march 31,2016.The rate of depreciation charged up to march 31,2016 was a)10.0% b)9.0% c)8.5% d)7.5%?
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On August 01,2013, k travels ltd.bought four matador vans costing 1,20,000/- each.The company expected to fetch a scrap value of 25% of the cost price of the vechicles after ten years.The vehicles were depreciated under the fixed instalment method up to march 31,2016.The rate of depreciation charged up to march 31,2016 was a)10.0% b)9.0% c)8.5% d)7.5%? 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 On August 01,2013, k travels ltd.bought four matador vans costing 1,20,000/- each.The company expected to fetch a scrap value of 25% of the cost price of the vechicles after ten years.The vehicles were depreciated under the fixed instalment method up to march 31,2016.The rate of depreciation charged up to march 31,2016 was a)10.0% b)9.0% c)8.5% d)7.5%? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for On August 01,2013, k travels ltd.bought four matador vans costing 1,20,000/- each.The company expected to fetch a scrap value of 25% of the cost price of the vechicles after ten years.The vehicles were depreciated under the fixed instalment method up to march 31,2016.The rate of depreciation charged up to march 31,2016 was a)10.0% b)9.0% c)8.5% d)7.5%?.
On August 01,2013, k travels ltd.bought four matador vans costing 1,20,000/- each.The company expected to fetch a scrap value of 25% of the cost price of the vechicles after ten years.The vehicles were depreciated under the fixed instalment method up to march 31,2016.The rate of depreciation charged up to march 31,2016 was a)10.0% b)9.0% c)8.5% d)7.5%? 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 On August 01,2013, k travels ltd.bought four matador vans costing 1,20,000/- each.The company expected to fetch a scrap value of 25% of the cost price of the vechicles after ten years.The vehicles were depreciated under the fixed instalment method up to march 31,2016.The rate of depreciation charged up to march 31,2016 was a)10.0% b)9.0% c)8.5% d)7.5%? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for On August 01,2013, k travels ltd.bought four matador vans costing 1,20,000/- each.The company expected to fetch a scrap value of 25% of the cost price of the vechicles after ten years.The vehicles were depreciated under the fixed instalment method up to march 31,2016.The rate of depreciation charged up to march 31,2016 was a)10.0% b)9.0% c)8.5% d)7.5%?.
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