On January 1, 2018, Alan Company purchased an equipment for P8,000,000. The equipment is depreciated using straight line method based on a useful life of 8 years with no residual value. On January 1, 2021, after 3 years, the equipment was revalued at a replacement cost of P12,000,000 with no change in residual value. On June 30, 2021, the equipment was sold for 10,000,000. How much is the gain (loss) on sale of equipment?

On January 1, 2018, Alan Company purchased an equipment for P8,000,000. The equipment is depreciated using straight line method based on a useful life of 8 years with no residual value. On January 1, 2021, after 3 years, the equipment was revalued at a replacement cost of P12,000,000 with no change in residual value. On June 30, 2021, the equipment was sold for 10,000,000. How much is the gain (loss) on sale of equipment?

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter7: Operating Assets

Section: Chapter Questions

Problem 9MCQ: Chapman Inc. purchased a piece of equipment in 2018. Chapman depreciated the equipment on a...

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