An asset bought for Rs 100,000 is depreciated at 20% on the written-down value for 2 years and then sold for Rs 59,000. What is the profit or loss on the sale?
Answer and explanation
Correct answer: B. Loss of Rs 5,000
- Step 1: Written-down value after 2 years = 100000 x 0.8 x 0.8 = 64000.
- Step 2: Sale price 59000 against WDV 64000 gives a loss of 5000.
Answer
Loss of Rs 5,000.
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