Companies are required to pay income-tax on book profits which are affected by the depreciation policy adopted by them. Suppose that a company has bought a machine for Rs 1,20,000, to be depreciated over a period of 5 years. The tax authorities allow either of the following three methods of providing for depreciation:

(a) straight line,

(b) sum of years' digits, and

(c) double declining balance. Since the balance of the asset never becomes zero under the method (c), a company following it is allowed to switch to the method

(a) in any year before the project life ends.

Determine the amount of depreciation in different years, under each of the methods given above and state which method would yield the best results, assuming that the management considers an 8% rate as a reasonable return on this type of investment.