Gia Corporation purchased machinery on January 1, 2019 for ₱840,000. The company used the sum-of-the-years’-digits method and no salvage value to depreciate the asset for the first two years of its estimated six-year life. In 2020, Gia changed to the straight-line depreciation method for this asset. The following facts pertain: 2019 2020 Straight-line ₱140,000 ₱140,000 Sum-of-the-years’-digits 240,000
Gia Corporation purchased machinery on January 1, 2019 for ₱840,000. The company used the sum-of-the-years’-digits method and no salvage value to depreciate the asset for the first two years of its estimated six-year life. In 2020, Gia changed to the straight-line depreciation method for this asset. The following facts pertain: 2019 2020 Straight-line ₱140,000 ₱140,000 Sum-of-the-years’-digits 240,000
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
Chapter11: Depreciation, Depletion, Impairment, And Disposal
Section: Chapter Questions
Problem 8P: Kam Company purchased a machine on January 2, 2019, for 20,000. The machine had an expected life of...
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Gia Corporation purchased machinery on January 1, 2019 for ₱840,000. The company used the sum-of-the-years’-digits method and no salvage value to depreciate the asset for the first two years of its estimated six-year life. In 2020, Gia changed to the
2019 2020
Straight-line ₱140,000 ₱140,000
Sum-of-the-years’-digits 240,000 200,000
- Gia is subject to a 40% tax rate. The cumulative effect of this accounting change on beginning
retained earnings is- ₱180,000 ₱96,000
- ₱160,000 ₱0
- The amount that Gia should report for depreciation expense on its 2021 income statement is
- ₱160,000 ₱100,000
- ₱140,000 ₱120,000
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