A vehicle has a scrap value of ₹6,75,000 after 10 years of its purchase. If the annual depreciation charge is ₹42,500 , then the original cost of the vehicle is:
Answer & explanation
Correct answer: option 3
$\text{Annual depreciation}=42500.$
$\text{Time}=10.$
$\text{Total depreciation}=10\times42500=425000.$
$\text{Scrap value}=675000.$
$\text{Original cost}=675000+425000=1100000.$
$\text{Original cost}=₹11,00,000.$