A Clothing Company in Pakistan Purchases a New Machine Worth

question 6

Multiple Choice

A clothing company in Pakistan purchases a new machine worth 1.5 million Pakistani Rupees (PKR) . In 5 years it will be worth PKR 300,000. Assuming a straight line depreciation, by how much should its value be depreciated each year?

• A) PKR 220,000
• B) PKR 240,000
• C) PKR 260,000
• D) PKR 280,000

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Definitions:

Insurer

A company or entity that provides financial protection against specified risks in return for premiums.

Disclosure

The act of making new or secret information known.

Concealment

The act of hiding or not disclosing important information intentionally.

Insurable Interest

A principle that requires an individual to have a legitimate financial or emotional stake in the preservation of the subject of insurance to obtain a policy.