PRC-1 · Chapter 6 · Question 55 of 100
A delivery truck is acquired for Rs. 4,800,000 on 1 April 2019. The expected life is 8 years with a nil residual value. Assuming a financial year-end of 31 December, what is the straight-line depreciation charge for 2019?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: D) Rs. 450,000
Explanation
Annual depreciation = 4,800,000 / 8 = 600,000. From 1 April to 31 Dec is 9 months. Pro-rated charge = 600,000 x (9/12) = Rs. 450,000.
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