An asset was acquired on January 1, 2020 for P800,000 and is expected to have a 5-year useful life. The straight-line method was used. On January 1, 2022, the asset was deemed to have a sound value of P720,000. How much is the revaluation surplus for the period ended December 31, 202
Q: 13 On January 2, 2020, VSG purchased a transportation equipment costing P2,400,000. The new asset…
A: Depreciation expense: Depreciation expense is the reduction in the particular asset due to its use…
Q: Kansas Enterprises purchased equipment for $78,000 on January 1, 2021. The equipment is expected to…
A: Annual Depreciation (straight line method) = (Cost of the equipment - Residual value) / Expected…
Q: ABC Company has an equipment acquired on January 1, 2018 at a cost of P2,200,000 with 20 years of…
A: Depreciation expense : The depreciation expense is a charge against the profit of the company,…
Q: equipment acquired on January 1, 2018 at a cost of P2,200,000 with 20 years estimated useful life.…
A: The tangible assets are the assets that help the company to generate revenue and earn income and It…
Q: MC19 The Diane Company has a single investment property acquired on July 1, 2019 for P11,400,000.…
A:
Q: 问题1 4分 On January 1, 2020, equipment is purchased at a cost of $60,000. The equipment will be in use…
A: The depreciation expense is charged on fixed assets as reduction in the value of fixed assets with…
Q: Machine A Machine B Machine C Cost 48,000 Useful Life 8 years Cost 70,000 Useful Life 8 years Cost…
A: Depreciation Expenses The purpose of providing the depreciation to the equipment which can be given…
Q: 1. Bruegger Transportation purchased a ship on January 1, 2022, for £20,000,000. The useful life of…
A: The journal Entry for both case are as follows:
Q: 7. An asset was purchased for P 150,000 and retired at the end of 15 years with a salvage value of P…
A: The annual cost of the assets includes the initial cost, operating cost, and maintenance cost of the…
Q: An asset was acquired on January 1, to 2020 for P800,000 and is expected to have a 5-year useful…
A: Annual depreciation on Equipment= (cost of the assets - residual value) / life of the assets =…
Q: ABC Company has equipment acquired on January 1, 2018, at a cost of P2,200,000 with an estimated…
A: When a fixed asset is acquired, it will be recorded in the books at its original cost. The asset…
Q: in 5 minutes ABC Company has an equipment acquired on January 1, 2018 at a cost of P2,200,000 with…
A: All fixed assets will have reduction in value over the period of time. Depreciation is being charged…
Q: PIKACHU purchased an equipment for P540,000 on January 1, 2020. The equipment has an estimated…
A: Depreciable cost = P540,000 - P60,000 = P480,000 Useful life = 5 years Sum of years of useful life =…
Q: 39. On January 1, 2019, Iver Company purchased equipment for P4,000,000. The equipment has a useful…
A: On jan 1,2019 the cost of the equipment is P4,000,000 and residual value is P400,000 with useful…
Q: On May 15, 2020, an asset with a depreciable basis of $40,000 is put into service. The half-year…
A: Accounting: It is the process of recording any financial transactions incurred in the financial year…
Q: In 2020, Tableta Company paid P4,000,000 to purchase a land containing a total estimated 160,000…
A: Under straight line method, Depreciation expense for equipment can be calculated as: = (Cost -…
Q: 8. An equipment was purchased for P600,000 on January 1, 2019. It had an estimated useful life of 10…
A: Solution:-8 The following formula used to calculate depreciation using straight line method as…
Q: ABC Company has equipment acquired on January 1, 2018, at a cost of P2,100,000 with 20 years…
A: 01.01.2018 COST 2100000 USEFUL LIFE 20 YEARS
Q: ISABELA Company has the following equipment acquisitions during the year 2020: April 1, 2020 – Cost…
A: Annual Depreciation (Straight line method) = ( Cost of Asset - salvage value ) / Useful life period…
Q: The actual carrying of an asset is R650 000 on 1 January 2020. Depreciation for the 2020 Financial…
A: Depreciation is the lessening in the worth of asset due to asset's overuse, erosion or obsolescence.…
Q: ABC Company purchased a building on January 1, 2018 for P10, 000,000. The building has been…
A: Depreciation is the amount which charged on an equipment for knowing the remaining amount of that…
Q: X Company purchases equipment for $120,000 on January 1, 2020. The equipment is estimated to last…
A: The depreciation expense is the reduction in the book value of the asset due to its use or with the…
Q: e Jessica Company purchased a drilling machine on October 1, 2018 at a cost of P250,000 and…
A: Solution: Firstly we need to compute Book value on Oct 1, 2020 by computing accumulated depreciation…
Q: How much is the decommissioning liability on January 1, 2018?
A: Decommissioning liability on Jan 1, 2018 would be the present value of the restoration cost of the…
Q: Maroon Company’s depreciation policy on machinery and equipment is as follows: A full year’s…
A: Net book value on June 30, 2021 = cost of the assets - Annual depreciation x 3 years = 420000 -…
Q: 2. ABC Company purchased equipment on January 1, 2020 for $560,000. The equipment has a residual…
A: The value of an asset is decreases due to use, wear and tear and this decreases value is known as…
Q: 17. Gulf Corp. purchased machinery for $250,000 on May 1, 2019. It is estimated that it will have a…
A: As posted multiple sub parts we are answering only first three sub parts kindly repost the…
Q: please answer question 19
A:
Q: PIKACHU purchased an equipment for P540,000 on January 1, 2020. The equipment has an estimated…
A: Sum of years' digits of useful life = 1+2+3+4+5 = 15 Depreciation fraction of 2020 = 5/15…
Q: 2. ABC Company has equipment acquired on January 1, 2018, at a cost of P2,200,000 with an estimated…
A: Depreciation means the loss in value of assets because of usage of assets , passage of time or…
Q: ABC Company has equipment acquired on January 1, 2018, at a cost of P2,200,000 with an estimated…
A: Revaluation of fixed assets: Carrying value of fixed assets is adjusted upwards or downwards with…
Q: 14.A machine costing P3,750,000 with an eight-year estimated useful life and an estimated residual…
A: Machine cost = P3,750,000 Residual value = P150,000 Depreciable value = Machine cost-Residual value…
Q: 5. An asset was purchased for P1,000,000.00 to be retired at the end of 15 years with a salvage…
A: With capitalized costs, the monetary value isn’t leaving the company with the purchase of an item,…
Q: Q3: Global Manufacturing Company purchased new equipment on April 29, 2020, at a cost of $80000.…
A: The performance of the assets purchased by the company will reduce each year. To record this…
Q: Jayanne Co. acquired an equipment for P4,200,000 in 2017. The policy is straight line depreciation,…
A: Annual depreciation = (Cost - salvage value)/useful life = (4,200,000 - 200,000)/5…
Q: An asset was acquired on January 1, 2020 for P800,000 and is expected to have a 5-year useful life.…
A: Annual Depreciation (straight line method) = (Cost of the assets - Residual value) / Expected life…
Q: the ROS On January 1, 2020 P1,000,000. The useful life is expected to be 10 years. On July 1, 2025,…
A: The wear and tear of an asset during the useful life of an asset is known as depreciation. The…
Q: How much is the revaluation surplus for the period ended December 31, 2022?
A: Any revaluation gain shall be credited to the revaluation surplus account. The additional…
Q: An asset was acquired on January 1, 2020 for P800,000 and is expected to have a 5-year useful life.…
A: Replacement cost is the cash outlay paid by an organization for the replacement of an old asset. The…
Q: Problem 3 An asset was acquired on January 1, 2020 for P800,000 and is expected to have a 5- year…
A: An asset is an important part of accounting.Depreciation is the wear and tear of asset which is…
Q: 14. On January 1, 2020, DAHLIA Company showed land with a carrying amount of ₱10,000,000 and…
A: The assets will be reported in the balance sheet. The company's value will be determined with the…
8
An asset was acquired on January 1, 2020 for P800,000 and is expected to have a 5-year useful life. The straight-line method was used. On January 1, 2022, the asset was deemed to have a sound value of P720,000. How much is the revaluation surplus for the period ended December 31, 202
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
- On May 10, 2019, Horan Company purchased equipment for 25,000. The equipment has an estimated service life of 5 years and zero residual value. Assume that the straight-line depreciation method is used. Required: Compute the depreciation expense for 2019 for each of the following four alternatives: 1. Horan computes depreciation expense to the nearest day. (Use 12 months of 30 days each and round the daily depreciation rate to 2 decimal places.) 2. Horan computes depreciation expense to the nearest month. Assets purchased in the first half of the month are considered owned for the whole month. 3. Horan computes depreciation expense to the nearest whole year. Assets purchased in the first half of the year are considered owned for the whole year. 4. Horan records one-half years depreciation expense on all assets purchased during the year.Depreciation Methods Sorter Company purchased equipment for 200,000 on January 2, 2019. The equipment has an estimated service life of 8 years and an estimated residual value of 20,000. Required: Compute the depreciation expense for 2019 under each of the following methods: 1. straight-line 2. sum-of-the-years-digits 3. double-declining-balance 4. Next Level What effect does the depreciation of the equipment have on the analysis of rate of return?Expenditures After Acquisition Roanoke Manufacturing placed a robotic arm on a large assembly machine on January 1, 2019. At that time, the assembly machine was expected to last another 3 years. The following information is available concerning the assembly machine. The robotic arm cost $225,000 and was expected to extend the useful life of the machine by 3 years. Therefore, the useful life of the assembly machine, after the arm replacement, is 6 years. The assembly machine is expected to have a residual value of $120,000 at the end of its useful life. Required: 1. Prepare the journal entry necessary to record the addition of the robotic arm. 2. Compute 2019 depreciation expense for the machine using the straight-line method, and prepare the necessary journal entry. 3. What is the book value of the machine at the end of 2019? 4. CONCEPTUAL CONNECTION What would have been the effect on the financial statements if Roanoke had expensed the addition of the robotic arm?
- At the beginning of 2020, Holden Companys controller asked you to prepare correcting entries for the following three situations: 1. Machine X was purchased for 100,000 on January 1, 2015. Straight-line depreciation has been recorded for 5 years, and the Accumulated Depreciation account has a balance of 45,000. The estimated residual value remains at 10,000, but the service life is now estimated to be 1 year longer than originally estimated. 2. Machine Y was purchased for 40,000 on January 1, 2018. It had an estimated residual value of 4,000 and an estimated service life of 8 years. It has been depreciated under the sum-of-the-years-digits method for 2 years. Now, the company has decided to change to the straight-line method. 3. Machine Z was purchased for 80,000 on January 1, 2019. Double-declining-balance depreciation has been recorded for 1 year. The estimated residual value is 8,000 and the estimated service life is 5 years. The computation of the depreciation erroneously included the estimated residual value. Required: Prepare any necessary correcting journal entries for each situation. Also prepare the journal entry for each situation to record the depreciation for 2020. Ignore income taxes.Hathaway Company purchased a copying machine for 8,700 on October 1, 2019. The machines residual value was 500 and its expected service life was 5 years. Hathaway computes depreciation expense to the nearest whole month. Required: 1. Compute depredation expense (rounded to the nearest dollar) for 2019 and 2020 using the: a. straight-line method b. sum-of-the-years-digits method c. double-declining-balance method 2. Next Level Which method produces the highest book value at the end of 2020? 3. Next Level Which method produces the highest charge to income in 2020? 4. Next Level Over the life of the asset, which method produces the greatest amount of depreciation expense?Comprehensive: Acquisition, Subsequent Expenditures, and Depreciation On January 2, 2019, Lapar Corporation purchased a machine for 50,000. Lapar paid shipping expenses of 500, as well as installation costs of 1,200. The company estimated that the machine would have a useful life of 10 years and a residual value of 3,000. On January 1, 2020, Lapar made additions costing 3,600 to the machine in order to comply with pollution-control ordinances. These additions neither prolonged the life of the machine nor increased the residual value. Required: 1. If Lapar records depreciation expense under the straight-line method, how much is the depreciation expense for 2020? 2. Assume Lapar determines the machine has three significant components as shown below. If Lapar uses IFRS, what is the amount of depreciation expense that would be recorded?
- On July 1, 2018, Mundo Corporation purchased factory equipment for 50,000. Residual value was estimated at 2,000. The equipment will be depreciated over 10 years using the double-declining balance method. Counting the year of acquisition as one-half year, Mundo should record 2019 depredation expense of: a. 7,680 b. 9,000 c. 9,600 d. 10,000Hunter Company purchased a light truck on January 2, 2019 for 18,000. The truck, which will be used for deliveries, has the following characteristics: Estimated life: 5 years Estimated residual value: 3,000 Depreciation method for financial statements: straight-line method Depreciation for income tax purposes: MACRS (3-year life) From 2019 through 2023, each year, Hunter had sales of 100,000, cost of goods sold of 60,000, and operating expenses (excluding depreciation) of 15,000. The truck was disposed of on December 31, 2023, for 2,000. Required: 1. Prepare an income statement for financial reporting through pretax accounting income for each of the 5 years, 2019 through 2023. 2. Prepare, instead, an income statement for income tax purposes through taxable income for each of the 5 years, 2019 through 2023. 3. Compare the total income for all 5 years under Requirements 1 and 2.Gray Companys financial statements showed income before income taxes of 4,030,000 for the year ended December 31, 2020, and 3,330,000 for the year ended December 31, 2019. Additional information is as follows: Capital expenditures were 2,800,000 in 2020 and 4,000,000 in 2019. Included in the 2020 capital expenditures is equipment purchased for 1,000,000 on January 1, 2020, with no salvage value. Gray used straight-line depreciation based on a 10-year estimated life in its financial statements. As a result of additional information now available, it is estimated that this equipment should have only an 8-year life. Gray made an error in its financial statements that should be regarded as material. A payment of 180,000 was made in January 2020 and charged to expense in 2020 for insurance premiums applicable to policies commencing and expiring in 2019. No liability had been recorded for this item at December 31, 2019. The allowance for doubtful accounts reflected in Grays financial statements was 7,000 at December 31, 2020, and 97,000 at December 31, 2019. During 2020, 90,000 of uncollectible receivables were written off against the allowance for doubtful accounts. In 2019, the provision for doubtful accounts was based on a percentage of net sales. The 2020 provision has not yet been recorded. Net sales were 58,500,000 for the year ended December 31, 2020, and 49,230,000 for the year ended December 31, 2019. Based on the latest available facts, the 2020 provision for doubtful accounts is estimated to be 0.2% of net sales. A review of the estimated warranty liability at December 31, 2020, which is included in other liabilities in Grays financial statements, has disclosed that this estimated liability should be increased 170,000. Gray has two large blast furnaces that it uses in its manufacturing process. These furnaces must be periodically relined. Furnace A was relined in January 2014 at a cost of 230,000 and in January 2019 at a cost of 280,000. Furnace B was relined for the first time in January 2020 at a cost of 300,000. In Grays financial statements, these costs were expensed as incurred. Since a relining will last for 5 years, Grays management feels it would be preferable to capitalize and depreciate the cost of the relining over the productive life of the relining. Gray has decided to nuke a change in accounting principle from expensing relining costs as incurred to capitalizing them and depreciating them over their productive life on a straight-line basis with a full years depreciation in the year of relining. This change meets the requirements for a change in accounting principle under GAAP. Required: 1. For the years ended December 31, 2020 and 2019, prepare a worksheet reconciling income before income taxes as given previously with income before income taxes as adjusted for the preceding additional information. Show supporting computations in good form. Ignore income taxes and deferred tax considerations in your answer. The worksheet should have the following format: 2. As of January 1, 2020, compute the retrospective adjustment of retained earnings for the change in accounting principle from expensing to capitalizing relining costs. Ignore income taxes and deferred tax considerations in your answer.
- On August 1, 2019, Kern Company leased a machine to Day Company for a 6-year period requiring payments of 10,000 at the beginning of each year. The machine cost 40,000 and has a useful life of 8 years with no residual value. Kerns implicit interest rate is 10%, and present value factors are as follows: Present value for an annuity due of 1 at 10% for 6 periods4.791 Present value for an annuity due of 1 at 10% for 8 periods5.868 Kern appropriately recorded the lease as a sales-type lease. At the inception of the lease, the Lease Receivable account balance should be: a. 60,000 b. 58,680 c. 48,000 d. 47,910Kam Company purchased a machine on January 2, 2019, for 20,000. The machine had an expected life of 8 years and a residual value of 300. The double-declining-balance method of depreciation is used. Required: 1. Compute the depreciation expense for each year of the assets life and book value at the end of each year. 2. Assuming that the company has a policy of always changing to the straight-line method at the midpoint of the assets life, compute the depreciation expense for each year of the assets life. 3. Assuming that the company always changes to the straight-line method at the beginning of the year when the annual straight-line amount exceeds the double-declining-balance amount, compute the depreciation expense for each year of the assets life.The following intangible assets were purchased by Hanna Unlimited: A. A patent with a remaining legal life of twelve years is bought, and Hanna expects to be able to use it for six years. It is purchased at a cost of $48,000. B. A copyright with a remaining life of thirty years is purchased, and Hanna expects to be able to use it for ten years. It is purchased for $70,000. Determine the annual amortization amount for each intangible asset.
