A Lorry is depreciated over a period of 7 years, with an initial cost of £65,000 and an estimated scrap value after 7 years of £2,000.The depreciation is calculated separately using two methods, the equal installment method and the diminishing balance method.
Calculate:
(a) using the equal installment method, the percentage of the initial cost to be written off each year.
(b) using the diminishing balance method, the rate of depreciation.
(c) the year in which the two methods give amounts of depreciation that are closest to each other.show your working.