An asset costing ₹20,000 is expected to have a useful life of 5 years and a final scrap value of ₹5000. Then the annual depreciation charge using linear method of depreciation is:

₹ 3,000

The correct answer is Option (2) → ₹ 3,000

$\text{Annual depreciation} = \frac{\text{Cost} - \text{Scrap value}}{\text{Life}}$

$= \frac{20000 - 5000}{5}$

$= \frac{15000}{5} = 3000$

The annual depreciation charge is ₹3000.