Question

What is the formula for computing depreciation in straight line method?

(a) D = \(\frac{P-S}{L*H} \)

(b) D = \(\frac{P+S}{L*H} \)

(c) D = \(\frac{P-S}{L+H} \)

(d) D = (P-S)*(L*H)

I had been asked this question in an interview for job.

My doubt stems from Disc Plough topic in division Tillage, Disc Plough & Numericals of Farm Machinery

Answer 1

The correct answer is (a) D = \(\frac{P-S}{L*H} \)

To explain: Depreciation is the decrease in cost of machines with passage of time, whether it is used or not. Simple line method is commonly used for determining the depreciation of agricultural machines.