GATE CE 2021 Set 2 — Question 53
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Structural Engineering → Construction Management → Cost Estimation
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Question
An equipment has been purchased at an initial cost of ₹160000 and has an estimated salvage value of ₹10000. The equipment has an estimated life of 5 years. The difference between the book values (in ₹, in integer) obtained at the end of year using straight line method and sum of years digit method of depreciation is ___________
Correct answer
20000 to 20000
Solution
1.Straight Line Method (SLM):
- Annual Depreciation =
- Accumulated Depreciation at end of 4 years =
- Book Value at end of 4 years () =
- Sum of years =
- Depreciation in year 1 =
- Depreciation in year 2 =
- Depreciation in year 3 =
- Depreciation in year 4 =
- Accumulated Depreciation at end of 4 years =
- Book Value at end of 4 years () =
- Difference =
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