{"id":8378,"date":"2024-04-15T02:59:37","date_gmt":"2024-04-15T02:59:37","guid":{"rendered":"https:\/\/exam.pscnotes.com\/mcq\/?p=8378"},"modified":"2024-04-15T02:59:37","modified_gmt":"2024-04-15T02:59:37","slug":"an-earth-moving-equipment-costs-rs-500000-and-has-an-estimated-life-of-10-years-and-a-salvage-value-of-rs-50000-what-uniform-annual-amount-must-be-set-aside-at-the-end-of-each-of-the-10-years-fo","status":"publish","type":"post","link":"https:\/\/exam.pscnotes.com\/mcq\/an-earth-moving-equipment-costs-rs-500000-and-has-an-estimated-life-of-10-years-and-a-salvage-value-of-rs-50000-what-uniform-annual-amount-must-be-set-aside-at-the-end-of-each-of-the-10-years-fo\/","title":{"rendered":"An earth moving equipment costs Rs. 5,00,000 and has an estimated life of 10 years and a salvage value of Rs. 50,000. What uniform annual amount must be set aside at the end of each of the 10 years for replacement if the interest rate is 8% per annum and if the sinking fund factor at 8% per annum interest rate for 10 years is 0.069? A. Rs. 31050 B. Rs. 34500 C. Rs. 37950 D. Rs. 50000"},"content":{"rendered":"<p>[amp_mcq option1=&#8221;Rs. 31050&#8243; option2=&#8221;Rs. 34500&#8243; option3=&#8221;Rs. 37950&#8243; option4=&#8221;Rs. 50000&#8243; correct=&#8221;option1&#8243;]<!--more--><\/p>\n<p>The correct answer is A. Rs. 31050.<\/p>\n<p>The sinking fund factor is the amount of money that must be invested each year at a given interest rate in order to accumulate a given sum at the end of a given period of time. In this case, the sinking fund factor is 0.069, which means that an investment of Rs. 0.069 will grow to Rs. 1 in 10 years at an interest rate of 8%.<\/p>\n<p>The amount that must be set aside each year to replace the earth moving equipment is equal to the cost of the equipment minus the salvage value, divided by the sinking fund factor. In this case, the amount is Rs. (500000 &#8211; 50000) \/ 0.069 = Rs. 31050.<\/p>\n<p>Option B is incorrect because it is the amount that must be set aside each year to replace the earth moving equipment if the interest rate is 6%. Option C is incorrect because it is the amount that must be set aside each year to replace the earth moving equipment if the interest rate is 10%. Option D is incorrect because it is the cost of the earth moving equipment.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>[amp_mcq option1=&#8221;Rs. 31050&#8243; option2=&#8221;Rs. 34500&#8243; option3=&#8221;Rs. 37950&#8243; option4=&#8221;Rs. 50000&#8243; correct=&#8221;option1&#8243;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[655],"tags":[],"class_list":["post-8378","post","type-post","status-publish","format-standard","hentry","category-construction-planning-and-management","no-featured-image-padding"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.2 (Yoast SEO v23.3) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>An earth moving equipment costs Rs. 5,00,000 and has an estimated life of 10 years and a salvage value of Rs. 50,000. What uniform annual amount must be set aside at the end of each of the 10 years for replacement if the interest rate is 8% per annum and if the sinking fund factor at 8% per annum interest rate for 10 years is 0.069? A. Rs. 31050 B. Rs. 34500 C. Rs. 37950 D. Rs. 50000<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/exam.pscnotes.com\/mcq\/an-earth-moving-equipment-costs-rs-500000-and-has-an-estimated-life-of-10-years-and-a-salvage-value-of-rs-50000-what-uniform-annual-amount-must-be-set-aside-at-the-end-of-each-of-the-10-years-fo\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"An earth moving equipment costs Rs. 5,00,000 and has an estimated life of 10 years and a salvage value of Rs. 50,000. What uniform annual amount must be set aside at the end of each of the 10 years for replacement if the interest rate is 8% per annum and if the sinking fund factor at 8% per annum interest rate for 10 years is 0.069? A. Rs. 31050 B. Rs. 34500 C. Rs. 37950 D. 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What uniform annual amount must be set aside at the end of each of the 10 years for replacement if the interest rate is 8% per annum and if the sinking fund factor at 8% per annum interest rate for 10 years is 0.069? A. Rs. 31050 B. Rs. 34500 C. Rs. 37950 D. Rs. 50000","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/exam.pscnotes.com\/mcq\/an-earth-moving-equipment-costs-rs-500000-and-has-an-estimated-life-of-10-years-and-a-salvage-value-of-rs-50000-what-uniform-annual-amount-must-be-set-aside-at-the-end-of-each-of-the-10-years-fo\/","og_locale":"en_US","og_type":"article","og_title":"An earth moving equipment costs Rs. 5,00,000 and has an estimated life of 10 years and a salvage value of Rs. 50,000. What uniform annual amount must be set aside at the end of each of the 10 years for replacement if the interest rate is 8% per annum and if the sinking fund factor at 8% per annum interest rate for 10 years is 0.069? A. Rs. 31050 B. Rs. 34500 C. Rs. 37950 D. 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