A vehicle has a scrap value of ₹7,50,000 after 6 years of its purchase. If the annual depreciation charge is ₹55,000, then the original cost of the vehicle is :
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → ₹10,80,000
Scrap value after 6 years = 7,50,000
Annual depreciation charges = 55,000
Total years = 6 years
Total depreciation = 6 × 55,000
= 3,30,000
∴ Original cost = 7,50,000 + 3,30,000
= 10,80,000