'P' is the investment made on an equipment, 'S' is its salvage value and 'n' is the life of the equipment in years. The depreciation for rath year by the sum-of years digit method will be

A) $$\frac{{{\text{P}} - {\text{S}}}}{{\text{n}}}$$ B) $$1 - {\left( {\frac{{\text{P}}}{{\text{S}}}} \right)^{\frac{1}{{\text{m}}}}}$$ C) $$\frac{{\text{m}}}{{\text{n}}} \cdot \left( {{\text{P}} - {\text{S}}} \right)$$ D) $$\frac{{2\left( {{\text{n}} - {\text{m}} + 1} \right)}}{{{\text{n}}\left( {{\text{n}} + 1} \right)}} \cdot \left( {{\text{P}} - {\text{S}}} \right)$$

Answer & Solution

Correct Answer: Option D

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P' is the investment made on an equipment 'S' is its...

'P' is the investment made on an equipment, 'S' is its salvage value and 'n' is the life of the equipment in years. The depreciation for rath year by the sum-of years digit method will be

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