1.) On January 1, 2019, Magnanimous Company's property, plant and equipment and accumulated depreciation had balances as follows: Accumulated Cost depreciation Land 875, 000 7, 500, 000 2, 250, 000 1, 644, 500 Building Machinery and equipment Leasehold improvements 635, 000 216, 000 108, 000 Depreciation method and useful life Building- doubles declining balance, 25 years Machinery and equipment- straight line, 10 years Leasehold improvements- straight line Land improvements- straight line Transactions during 2019 and other information a. On January 1, 2019, a plant facility consisting of land and building was acquired from King Company in exchange for 25, 000 shares of Magnanimous Company. b. On this date, the share had a market price of P50. Current assessed values of land and building for property, tax purposes are PI50, 000 and P600, 000, respectively. c. On March 31, 2019, new parking lot, street and sidewalk at the acquired plant facility were completed at a total cost of P192, 000. These expenditures had an estimated useful life of 12 years. d. The leasehold improvement was completed on December 31, 2015, and had an estimated useful life of 8 years. The related lease, which would have terminated on December 21, 2021, was renewable for an additional four-year term. On April 30, 2019, Magnanimous Company exercised the renewal option. e. On July 1, 2019, machinery and equipment were purchased at a total invoice cost of P340, 000. Additional cost of PI0, 000 for delivery and P50, 000 for installation were incurred. f. On November 1, 2019, Magnanimous Company purchased for P350, 000 at tract of land for undetermined use. g. On December 15, 2019, a machine with a cost of P170, 000 and carrying amount of P29, 750 at date of disposition was scrapped without cash recovery. Required: Determined the balances of the following for the year ended December 31, 2019. 1. Land, as a part of property, plant and equipment. 3. Depreciation of machinery and equipment 4. Depreciation of leasehold improvements 5. Depreciation of land improvements

1.) On January 1, 2019, Magnanimous Company's property, plant and equipment and accumulated depreciation had balances as follows: Accumulated Cost depreciation Land 875, 000 7, 500, 000 2, 250, 000 1, 644, 500 Building Machinery and equipment Leasehold improvements 635, 000 216, 000 108, 000 Depreciation method and useful life Building- doubles declining balance, 25 years Machinery and equipment- straight line, 10 years Leasehold improvements- straight line Land improvements- straight line Transactions during 2019 and other information a. On January 1, 2019, a plant facility consisting of land and building was acquired from King Company in exchange for 25, 000 shares of Magnanimous Company. b. On this date, the share had a market price of P50. Current assessed values of land and building for property, tax purposes are PI50, 000 and P600, 000, respectively. c. On March 31, 2019, new parking lot, street and sidewalk at the acquired plant facility were completed at a total cost of P192, 000. These expenditures had an estimated useful life of 12 years. d. The leasehold improvement was completed on December 31, 2015, and had an estimated useful life of 8 years. The related lease, which would have terminated on December 21, 2021, was renewable for an additional four-year term. On April 30, 2019, Magnanimous Company exercised the renewal option. e. On July 1, 2019, machinery and equipment were purchased at a total invoice cost of P340, 000. Additional cost of PI0, 000 for delivery and P50, 000 for installation were incurred. f. On November 1, 2019, Magnanimous Company purchased for P350, 000 at tract of land for undetermined use. g. On December 15, 2019, a machine with a cost of P170, 000 and carrying amount of P29, 750 at date of disposition was scrapped without cash recovery. Required: Determined the balances of the following for the year ended December 31, 2019. 1. Land, as a part of property, plant and equipment. 3. Depreciation of machinery and equipment 4. Depreciation of leasehold improvements 5. Depreciation of land improvements

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter22: Accounting For Changes And Errors.

Section: Chapter Questions

Problem 11E: On January 1, 2014, Klinefelter Company purchased a building for 520,000. The building had an...

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