GDB No 2 MTH302 start from 23 June to 27 june 2016

Question 1:

An asset has a cost of Rs. 50000. After 11 years, its salvage value is Rs. 9000.  What is the sum-of-years' digits depreciation of the asset for one year?

Question 2:

Let your garments business net sales were 55, 00,000 and total variable costs were 2, 05,000 in last year. You spent 50,000 on machinery, depreciation cost of 14,000, rent 25,000, wages 40,000 and other costs related to making the garments as 30,500. What was your net income for last year?

Answer for Question no 1 use this formula:

SYD= (cost-Salvage value)*(life-Per+1)*2 / (life)(life+1)
where as;
 Cost = 50,000
Salvage value= = 9,000
Useful life = =11 years
 As we have to find out the depreciation for one year so
Per = 1

 SYD= (cost-Salvage value)*(life-Per+1)*2 / (life)(life+1)
(50,000-9000)*(11-1+1)*2/11(11+1) = 6833

Question No 2 Solution:
For Variable cost and sale we have to find out the Contribution margin; i.e
Contribution margin = Net sales - total variable cost - Other variable costs
then,
Total Fixed cost i.e
Fixed costs = Machinery cost + Depreciation cost + Rent Cost + Wages Cost
then,
Net income = contribution Margin - Fixed Cost
And you will get your answer NET INCOME.......