53. On January 1, 2019 Cheese Company acquired and installed an oil rig. The was acquired at its fair value of P20,000,000 and the company incurred a total P2,000,000 to install and prepare the asset for its intended use.. The estimated useful life of the rig is 10 years and after which the company has an obligation to dismantle immediately. Initial estimate of the cash outflow to dismantle the rig is P500,000. The discount rate is 10%. On January 1, 2021 Cheese Company revised the estimate to dismantle the rig to P700,000. What is the carrying value of the oil rig immediately after the revised estimate was accounted for? a. P17,600,000 C. P17,754,216 P17,847,516 b. P17,660,916 d.
53. On January 1, 2019 Cheese Company acquired and installed an oil rig. The was acquired at its fair value of P20,000,000 and the company incurred a total P2,000,000 to install and prepare the asset for its intended use.. The estimated useful life of the rig is 10 years and after which the company has an obligation to dismantle immediately. Initial estimate of the cash outflow to dismantle the rig is P500,000. The discount rate is 10%. On January 1, 2021 Cheese Company revised the estimate to dismantle the rig to P700,000. What is the carrying value of the oil rig immediately after the revised estimate was accounted for? a. P17,600,000 C. P17,754,216 P17,847,516 b. P17,660,916 d.
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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