Using reducing balance method at the rate of 20%. What is the depreciation charge for the second year?

Use the following information to answer the given question,

	#
Purchase price of equipment	60,000
Freight and installation cost	10,000
Annual maintenance cost	1,000
Estimated useful life – 5 years
Estimated scrap value	2000

A. N13,600
B. N11,200
C. N10,880
D. N9,600

Correct Answer: Option B