LILY Company purchased machinery on January 1, 2020. It has an estimated useful life of four years and a residual value of ₱500,000. The machine is being depreciated using SYD Method. The depreciation applicable to this fixed asset for 2021 is ₱1,200,000. What was the acquisition cost of the machinery?        A. ₱ 3,000,000       B. ₱ 3,500,000       C. ₱ 4,000,000       D. ₱ 4,500,000

Q: On January 1, 2021, Marigold company acquired a computer amounting to P47,000, transportation cost…

A: Cost of computer = Purchase price of computer + transportation cost + installation cost of desk…

Q: Mandu Corp. acquired a machine at a total cost of P5,200,000. The estimated life of the machine is 8…

A: Depreciation per hour = (Cost of the assets - Salvage value) / Total estimated operating machine…

Q: On January 1, 2021, Mama Company purchased a machine for P2,750,000. The machine was depreciated…

A: Depreciation - Depreciation is computed every year due to wear and tear of the assets, for the…

Q: ROSE Company purchased machinery on January 1, 2020. It has an estimated useful life of four years…

A: Depreciation means decline in the estimation of benefit inside its valuable life because of mileage…

Q: ARON Corp. acquired a machine at a total cost of P5,200,000. The estimated life of the machine is 8…

A: Depreciation per hour = (Cost of the assets - Salvage value) / Total estimated operating machine…

Q: On January 3, 2019, Soju Co. purchased machinery. The machinery has an estimated useful life of…

A: The depreciation is a decline in the value of tangible assets over their useful life. it is a…

Q: The Clarke Co. acquired a machine on May 1, 2021, at a cost of $60,000. The machine is expected to…

A: Date of acquiring: May 1, 2021 Cost: $ 60,000 Life: 10 years Residual Value: $5,000 Life (in units):…

Q: On January 1, 2021, PANCHITAS CAFÉ purchased equipment for $180,000. The equipment had an estimated…

A: SLM depreciation = (cost - salvage value)/life = (180000-40000)/10 = 14000 SLM rate = SLM…

Q: On June 30, 2021, Maroon sold for P230,000 a machine acquired in 2018 for P420,000. The accumulated…

A:

Q: The Fisher Company purchased a machine on October 1, 2018, for $18,000. At the time of acquisition,…

A: Depreciable cost=Cost-Salvage value=$18,000-$5,000=$13,000

Q: On January 2, 2020, VSG purchased a transportation equipment costing P2,400,000. The new asset has…

A: Accumulated depreciation, December 31, 2022 = P2,400,000 x 2/8 = P600,000 Carrying value, December…

Q: . On January 1, 2019, Tarlac Company acquired a machine for P4,500,000. The machine has a useful…

A: Depreciation is a method of accounting that distributes the expense of a tangible or physical asset…

Q: e was sold for P26,000. What should be the loss recognized from the sale of the machine?

A:

Q: On January 1, 2017, RIP Isabel Granada Company purchased a machinery for P600,000, with an estimated…

A: 1. Impairment loss is carrying amount below the recoverable amount.  depreciation calculated based…

Q: On Oct. 1, 2020, Shaw Company purchased a machine for P1,260,000 that was placed in service on Nov.…

A: Depreciation: Depreciation means the reduction in the value of an asset over the life of the assets…

Q: Drago Company purchased equipment on January 1, 2021, at a total invoice cost of $1,200,000. The…

A: working notes: Depreciation = (1,200,000 – 30,000)/5 useful life  Total accumulated depreciation  (2…

Q: Forrester Company purchased a machine on January 1, 2019 for $60,000, with a 5-year life, and a…

A: Double declining depreciation rate = Straight line depreciation rate x 2 = (100/5 years) x 2 = 40%

Q: 1. Which depreciation method is the company using in each example? 2. Compute the depreciation…

A: (1). N Company purchased as asset for $17,000 on January 2, 2021. The asset has an expected residual…

Q: Mandu Corp. acquired a machine at a total cost of P5,200,000. The estimated life of the machine is 8…

A: Depreciation rate per hour = (Cost-Salvage value)/Total working hours

Q: Brave Corporation acquired equipment on January 3, 2018 at a cost of P100,000. The estimated useful…

A:

Q: Mortal Company acquired a machine for P3,200,000 on August 31, 2017. The machine has a 5-year useful…

A: Impairment of fixed assets means when fair value of the fixed assets is less than the carrying value…

Q: Coachwhip Corporation purchased a machinery on January 1, 2022 for P5,000,000. The same had an…

A: Answer) Calculation of Revaluation Surplus Revaluation Surplus = Fair Value of Equipment on January…

Q: Tamarisk Company purchased a machine on January 2, 2020, for $725,400. The machine has an estimated…

A:

Q: Goliath Company purchased an equipment on January 2, 2017 for P3,000,000. At the date of…

A: Straight line is one of easy and common depreciation method used by accountants to calculate the…

Q: On January 3, 2019, Soju Co. purchased machinery. The machinery has an estimated useful life of…

A: Sum of the years digits = n(n+1)/2 Sum of the years digits =  8(8+1)/2 Sum of the years digits =…

Q: n January 1, 2019, ABC Company acquired a machine for 4,500,000. The machine has a useful life of 10…

A: A corporation can use the revaluation model to carry a fixed asset at its revalued value. Following…

Q: On April1, 2021,DG Corporation purchased an equipment with cost of 150000. The company estimate that…

A: Every fixed asset loses its value over the period of time. Depreciation is being recorded on cost of…

Q: ROSE Company purchased machinery on January 1, 2020. It has an estimated useful life of four years…

A: Depreciation expense is related to the drop in the value of an asset periodically because of the…

Q: Tammy Company purchased a boring machine on January 12018 for P8, 100 000. The useful life of the…

A: Depreciation The purpose of using the Depreciation is to calculate the actual value of the machine…

Q: ABC Co. purchased machinery that was installed and ready for use on January 3, 2020, at a total cost…

A: Solution: Depreciation rate - SLM = 1/5 = 20% Depreciation rate- DDB = 20%*2 = 40% Cost of machine =…

Q: On January 1, 2019, Tarlac Company acquired a machine for P4,500,000. The machine has a useful life…

A: Depreciation: Depreciation means the reduction in the value of an asset over the life of the assets…

Q: On January 1, 2020, Dan Company purchased a new machine for P4,000,000. The new machine has an…

A:

Q: On January 1, 2022, Proton Company purchased a new machine or P2,100,000. The new machine has an…

A: The time period depreciation refers to an accounting technique used to allocate the value of a…

Q: On April 1, 2018, Magnum Company purchased a delivery equipment for $88,000, with an expected useful…

A: The depreciation is an expense charged on fixed asset as the reduction in the value of fixed asset…

Q: ROSE Company purchased machinery on January 1, 2020. It has an estimated useful life of four years…

A: Depreciation (SYD)  = Reverse Working Life Digit × (Cost of Fixed Assets - Salvage Value ) / Sum of…

Q: Bramble Corp. purchased a depreciable asset for $ 726000 on April 1, 2018. The estimated salvage…

A: Solution: Annual depreciation on asset = (Cost - Salvage value) / Useful life = ($726,000 - $72,000)…

Q: The Nickle Company purchased an asset for P17,000 on January 2, 2021. The asset has an expected…

A: (1). N Company purchased as asset for $17,000 on January 2, 2021. The asset has an expected residual…

Q: On January 5, 2021, Lighter Company acquired a building. The building had an estimated useful life…

A: Sum of years' digits of useful life = 1+2+3+4+5+6+7+8+9+10 = 55 years Depreciation fraction of 2021…

Q: King Company purchased a machine on July 1, 2021, for P600,000. The machine has an estimated useful…

A: If the value of an asset gets reduced due to the normal usage in the the operation of the business,…

Q: Arabs Company purchased a machine for P650,000 on January 1, 2016. The estimated salvage value of…

A: Cost of machine = P 650,000 Salvage value = P 46,500 Life = 10 Years Used period (From Jan 1 2016 to…

Q: RS Inc. acquired a delivery truck for P2,100,000 on January 1, 2018. The delivery truck has useful…

A: 1. Sum of useful life  = 5+4+3+2+1  = 15 2. Calculation of depreciation rate for each year under sum…

Q: FDN Company acquires a building on April 1, 2021 at a cost of P52,500,000.  The building has an…

A: The depreciation expense is charged on fixed assets as reduced value of the fixed asset with usage…

Q: Spiral Company uses the sun-of-the years’ digits method to depreciate equipment purchased in January…

A: Solution: Depreciation is a reduction in the value of an asset over time, due to normal wear and…

Q: ORCHID Company purchased machinery on January 1, 2020. It has an estimated useful life of four years…

A: Depreciation is the allocation of cost of asset over the useful life of the asset.

Q: Coachwhip Corporation purchased a machinery on January 1, 2022 for P5,000,000. The same had an…

A: solution ‘ working note purchase date of machinery        =January 1 2022 annual depreciation…

Q: On January 1, 2021, Capiz Company purchased factory equipment for P8,000,000. Estimated salvage…

A: Double declining balance method: It is the method of charging depreciation where the depreciation is…

Q: ROSE Company purchased machinery on January 1, 2020. It has an estimated useful life of four years…

A: Depreciation expense is related to the drop in the value of an asset periodically because of the…

Q: On July 1, 2020, New Orleans Corporation purchased equipment at a cost of P340,000. The equipment…

A: Depreciation rate = ( 100 / Useful life ) x 2

Depreciation Methods

The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.

Depreciation Accounting

In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.