Question

The cost price of a machine is Rs 2,50,000. If the rate of depreciation is 10% per year, find the depreciation in price of the machine after two years.

Answer 1

Here, P = Cost price of machine = Rs 2,50,000 

R = Rate of depreciation per year = 10% 

N = 2 years 

A = Depreciated price of the machine after 2 years

= 2,500 × 81 

= Rs 2,02,500 

Depreciation in price = Cost price (P) – Depreciated price (A) 

= 2,50,000 – 2,02,500 

= Rs 47,500

∴ The depreciation in price of the machine after 2 years would be Rs 47,500.