A piece of equipment cost a certain factory Rs 6,00,000. If it depreciates in value, 15 % the first, 13.5 % the next year, 12 % the third year, and so on. What will be its value at the end of 10 years, all percentages applying to the original cost?

By BYJU'S Exam Prep

Updated on: September 25th, 2023

At the end of 10 years, all percentages applying to the original cost is Rs. 105000. The item of equipment loses 15% of its value in the first year, or

15/100 × 600,000 = Rs.90,000

∴Value depreciated in 1st year = Rs.90,000

In the second year, the equipment depreciates at a rate of 13.5%, i.e.

135/1000×600,000 =Rs.81000

∴Value depreciated in 2st year =Rs.81,000

The value after 3rd year = 12/100 × 600000

∴ Value depreciated in 3rd year = Rs.72000

The the series of depreciation become 90,000, 81,000, 72, 000…with,

a =90,000 and d =−9000

The total depreciation in 10 years:

S10 = 10/2 [2 × 90000 + (9) (-9000)]

= 5(180000 – 81000)

= 5 (99000)

= Rs. 495000

The cost of machine after 10 years:

= 600000 – 495000

= Rs. 105000

Table of content

1. A piece of equipment cost a certain factory Rs 6,00,000. If it depreciates in value, 15 % the first, 13.5 % the next year, 12 % the third year, and so on. What will be its value at the end of 10 years, all percentages applying to the original cost?

Cost Price (CP)

Cost price refers to the price paid to purchase a good or commodity. Denoted as CP as well. This cost price is divided into two more categories:

Fixed Cost: Under any conditions, the fixed cost remains constant.

Variable Cost: It may change based on the quantity of units and other elements.

Selling Price (SP): The selling price is the price at which a product is sold. Typically, it is identified as SP. also known as a sale price on occasion.

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