[amp_mcq option1=”Rs. 5,000″ option2=”Rs. 4,500″ option3=”Rs. 3,333″ option4=”Rs. 3,000″ correct=”option3″]<\/p>\n
The correct answer is C. Rs. 3,333.<\/p>\n
The sum of the years digit method is a depreciation method that allocates a higher depreciation expense in the early years of an asset’s life and a lower depreciation expense in the later years. The formula for calculating depreciation expense using the sum of the years digit method is:<\/p>\n
Depreciation expense = (Cost – Salvage value) \/ (Sum of the years of the asset’s life)<\/p>\n
In this case, the cost of the asset is Rs. 10,000, the salvage value is Rs. 1,000, and the useful life is 3 years. The sum of the years of the asset’s life is 1 + 2 + 3 = 6. Therefore, the depreciation expense for the first year is:<\/p>\n
Depreciation expense = (10,000 – 1,000) \/ 6 = 3,333<\/p>\n
The other options are incorrect because they do not represent the correct amount of depreciation expense for the first year.<\/p>\n","protected":false},"excerpt":{"rendered":"
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