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Swati mukherjee

Swati Mukherjee (14 Points)

02 July 2016

What is the formula of calculating depreciation under w.d.v method in f.y -2015-16?

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2 Replies

Ajeet Singh (Service ) (190 Points)
Replied 02 July 2016

Calculating Depreciation under WDV method: 1. Original Cost 100 2. Original Useful Life (Co Act, 1956) 20 years 3. Depreciation rate (Co Act, 1956) 13.91 % 4. New Useful Life (Co Act, 2013) 15 years 5. Expired Life 5 years 6. Remaining Useful Life (4-5) 10 years 7. Accumulated Depreciation 52.71 Depreciation will not be calculated over 15 years. It will be calculated over 5 years only. Formula to calculate WDV rate: formula We will like to discuss how to calculate such square root: First divide 5,000/1,00,000 : 0.05 Press under root button 12 times Subtract 1 Divide by factor, here 10 Add 1 Press (* =) 12 times After these, amount 0.7412 Now, 1 – 0.7412 = .2588 i.e. 25.88 % Here, Carrying Amount = 100 – 52.71 = 47.29 Year Closing Balance 1 35.05 2 25.98 3 19.26 4 14.27 5 10.58 6 7.84 7 5.81 8 4.31 9 3.19 10 2.37

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Ajeet Singh (Service ) (190 Points)
Replied 02 July 2016

Calculating Depreciation under WDV method:

1. Original Cost 100
2. Original Useful Life (Co Act, 1956) 20 years
3. Depreciation rate (Co Act, 1956) 13.91 %
4. New Useful Life (Co Act, 2013) 15 years
5. Expired Life 5 years
6. Remaining Useful Life (4-5) 10 years
7. Accumulated Depreciation 52.71

Depreciation will not be calculated over 15 years. It will be calculated over 5 years only.

Formula to calculate WDV rate:

formula

We will like to discuss how to calculate such square root:

First divide 5,000/1,00,000 : 0.05

Press under root button 12 times

Subtract 1

Divide by factor, here 10

Add 1

Press (* =) 12 times

After these, amount 0.7412

Now, 1 – 0.7412 = .2588 i.e. 25.88 %