91Ó°ÊÓ

Depreciation can be stated as the decline in the value of an asset over a useful period. All assets depreciate over time, except land whose value increases with the passage of time. Among the various methods of depreciation, straight-line depreciation is considered to be the simplest and error-free method.

Working note:

For calculating depreciation expense following formula should be used

$\text{¶Ù±ð±è°ù±ð³¦¾±²¹³Ù¾±´Ç²Ô e³æ±è±ð²Ô²õ±ð}=\text{°ä´Ç²õ³Ù o´Ú a²õ²õ±ð³Ù}×\text{¶Ù±ð±è°ù±ð³¦¾±²¹³Ù¾±´Ç²Ô r²¹³Ù±ð}$

Like, for calculating depreciation for 2017

$\begin{array}{c}\text{¶Ù±ð±è°ù±ð³¦¾±²¹³Ù¾±´Ç²Ô e³æ±è±ð²Ô²õ±ð}=\text{°ä´Ç²õ³Ù o´Ú a²õ²õ±ð³Ù}×\text{¶Ù±ð±è°ù±ð³¦¾±²¹³Ù¾±´Ç²Ô r²¹³Ù±ð}\\ \text{=\$50,000}×\text{20\%}\\ \text{=\$10,000}\end{array}$

For computing depreciation following formula should be used.

$\text{¶Ù±ð±è°ù±ð³¦¾±²¹³Ù¾±´Ç²Ô r²¹³Ù±ð}=\frac{\text{Year}}{\text{±«²õ±ð´Ú³Ü±ô l¾±´Ú±ð o´Ú a²õ²õ±ð³Ù}}$

Like, for 2017 depreciation rate is as follows:

$\begin{array}{c}\text{¶Ù±ð±è°ù±ð³¦¾±²¹³Ù¾±´Ç²Ô r²¹³Ù±ð}=\frac{\text{Year}}{\text{±«²õ±ð´Ú³Ü±ô l¾±´Ú±ð o´Ú a²õ²õ±ð³Ù}}\\ =\frac{1}{5}\\ =20\%\end{array}$