As asset costing ₹1,50,000 has a final scrap value of ₹35,000. If annual depreciation charge is ₹23,000, then useful Life of the asset is :
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → 5 years
$\text{Depreciation per year} = \frac{\text{Cost of Asset - Scrap value}}{\text{Useful Life}}$
$\text{Useful Life}=\frac{1,50,000-35,000}{23,000}$
$=\frac{1,15,000}{23,000}=5$ Years