FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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ABC Company acquired an equipment on January 1, 2020 for
P5,000,000. Depreciation is computed using the straight-line method.
The estimated useful life of the equipment is five years with no residual
value. A specific price index applicable to the equipment was 150 on
January 1, 2020 and 225 on December 31, 2020. What is the unrealized
holding gain on the equipment to be reported in 2020?

 

A. 1,250,000
B. 1,500,000
C. 2,000,000
D. 2,500,000

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1. What amount of depreciation should be reported in the historical cost income statement for 2021?

2. Whhat amount of deprecitation should be reported in the current cost income statement for 2021?

3. What amount should be reported as realized holding gain on the equipment for 2021?

 

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Follow-up Question

1. What amount of depreciation should be reported in the historical cost income statement for 2021?

2. Whhat amount of deprecitation should be reported in the current cost income statement for 2021?

3. What amount should be reported as realized holding gain on the equipment for 2021?

 

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