On January 1, 2020, Company discovered that it had incorrectly expensed a P2,100,000 machine purchased on January 1, 2017. The entity estimated the machine’s original useful; life to be 10 years and the residual value at P100,000. The entity used the straight-line method of depreciation and is subject to a 30% income tax rate. In the December 31, 2020 financial statements, what amount should be reported as prior period error? A.P1,659,000 B.P1,029,000 C.P1,050,000 D.P1,680,000

Q: Holtzman Company is in the process of preparing its financial statements for 2020. Assume that no…

A: a. Prepare journal entries to record depreciation expense for equipment 2020 as shown below:

Q: n March 10, 2021, S Incorporated paid property taxes of 240,000 for the calendar year 2021. On April…

A: Concept - Interim reporting treats each interim period as an integral part of the annual period.…

Q: In 2020, Pina Corporation discovered that equipment purchased on January 1, 2018, for $47,000 was…

A: Debit Credit Equipment a/c.     Dr. $47000   To Accumulated Depreciation   $ 18800 To…

Q: Shellfish Company determined that, due to the obsolescence, equipment with an original cost of…

A: Calculation of balance of accumulated depreciation as on December 31, 2020 Balance of Accumulated…

Q: Qec Inc. bought machinery worth $120,000 on January 1st, 2014. With no residual value, it estimated…

A: Depreciation is an accounting technique for distributing a tangible or fixed asset's cost over its…

Q: Equipment was purchased on January 2, 2020, for $24,000, but no portion of the cost has been charged…

A: Depreciation: Depreciation is the reduction in the value in a fixed asset due to natural factors…

Q: At the end of 2019, while preparing its financial statements, Shamrock Ltd. discovered an error in…

A: The depreciation expense is calculated by deducting the residual value from the original value of…

Q: What is the impact of the error in 2022 net income?

A: Hardy Man Inc. incurred repair costs of a machine in 2021 for P 30,000 and erroneously capitalized…

Q: Ernst Company purchased equipment that cost $3,000,000 on January 1, 2020. The entire cost was…

A:

Q: Dimmu Company purchased a machine on January 1, 2021, at a cost of P 120.000. An additional P 50.000…

A: Given cost of the machine = P 120,000 Salvage value = P 20,000 Useful life = 5 years Depreciation…

Q: For financial reporting, Clinton Poultry Farms has used the declining-balance method of depreciation…

A:

Q: Shellfish Company determined that, due to the obsolescence, equipment with an original cost of…

A: Calculation of Carrying Value of Equipment on January 1, 2020 Carrying value of equipment =…

Q: Sheridan Corporation uses straight-line depreciation, prepares adjusting entries annually, and has a…

A: Lets understand the basics. In stright line basis, depreciation is calculated in equal installment…

Q: Lehman Corporation purchased a machine on January 2, 2017, for $4,000,000. The machine has an…

A: The correct answer is option a, that is, $144,000.

Q: In 2017, Bailey Corporation discovered that equipment purchased on January 1, 2015, for $50,000 was…

A: Prepare Bailey’s 2017 journal entry to correct the error. Bailey uses straight-line depreciation.

Q: What is the debit amount for the depreciation expense? What is the credit amount for accumulated…

A: Depreciation expenses is the amount of an asset's cost that has been allocated and reported as an…

Q: Tiger Ltd purchased a machine on 1 July 2017 at the cost of $640,000. The machine is expected to…

A: Depreciation is the reduction in the value of asset due to obsolesce, wear and tear or usage.…

Q: On January 1, 2019, Sandhill Corporation acquired machinery at a cost of $1720000. Sandhill adopted…

A: As per IFRS a change in method of  depreciation  is a change in accounting estimate

Q: Assume that for a particular company, the only temporary difference for tax-effect accounting…

A: Depreciation refers to the permanent decline in value of tangible assets, because of wear and tear…

Q: In March 2019, Dempo Org purchased production equipment valued at $640,000.  In 2021, auditors…

A: Introduction:- Dempo Org invested $640,000 on production equipment. Auditors determined in 2021 that…

Q: In 2018, internal auditors discovered that PKE Displays, Inc., had debited an expense account for…

A: Journal entry: Journal entry is a set of economic events that can be measured in monetary terms.…

Q: 2. On January 1, 2019, KRIS KRINGLE Company purchased a ₱600,000 machine, with a five-year useful…

A: Change in method of depreciation is not a change in accounting policy. And hence no retrospective…

Q: In 2020, Bailey Corporation discovered that equipment purchased on January 1, 2018, for $50,000 was…

A: Pass necessary rectification entries in the books of Bailey Corporation.

Q: On March 10, 2020, Waterway Limited sold equipment that it bought for $266,880 on August 21, 2013.…

A: Depreciation: It is an expense incurred in the day-to-day normal use of assets during the…

Q: On January 1, 2019, Uptown Builders purchased a machine for $200,000.  Uptown's policy is to…

A: Depreciation under Straight line method is computed in the following manner:  Depreciation = (Cost…

Q: On January 2, 2016, Dec Company purchased a patent for a new consumer product for P900,000. patent…

A: Patents are intangible assets (those which do not have physical appearance). Intangible assets are…

Q: On January 1, 2020- D mpany purchased a machine that cost $72,000 and had no estimated salvage…

A: Introduction: Depreciation: Decreasing value of fixed assets over its useful life period called as…

Q: Equipment was purchased on January 2, 2017, for $24,000,but no portion of the cost has been charged…

A: Accounting error: Accounting errors can be defined as omission of the fundamental accounting…

Q: On 1/1/2015 IMAR Co. has equipment with an initial cost of $200,000 with useful life of 10 years…

A: Straight line method of depreciation is depreciation method which charges equal amount of…

Q: Colorado Company has been using the sum-of-the-years'-digits depreciation method to depreciate some…

A: Introduction:- Calculation of depreciation for 2019 and 2020 as follows:- 2019 =120,000 x 5/15…

Q: n 2020, Windsor Corporation discovered that equipment purchased on January 1, 2018, for $59,000 was…

A: A deferred tax liability is an inventory on a company's balance sheet that records taxes that are…

Q: In 2018, internal auditors discovered that PKE Displays, Inc. had debited an expense account for the…

A: The following formula is used to calculate depreciation of asset.

Q: The Laura Company has the following errors on its books as of December 31, 2020. The books for 2020…

A: A Journal entry is a primary entry that records the financial transactions initially. The…

Q: For financial reporting, Clinton Poultry Farms has used the declining-balance method of depreciation…

A: A journal entry is the process of recording or maintaining track of any financial or non-financial…

Q: On January 1, 2021, Save Company discovered that it had incorrectly expensed a P2,100,000 machine…

A: Compute the depreciation per year: Depreciation per year = (P2,100,000-100,000)/10 = P200,000 Thus,…

Q: In 2021, internal auditors discovered that PKE Displays, Inc., had debited an expense account for…

A: Journal entry: Journal entry is a set of economic events that can be measured in monetary terms.…

Q: Kaila Corporation purchased a truck for 225,000 on January 1, 2017. It was originally depreciated on…

A: Calculation of depreciation Expenses for the year 2019 are as follows:

Q: On January 1, 2019, Nobel Corporation acquired machinery at a cost of P600,000. Nobel adopted the…

A: solution annual depreciation under straight line method =600000 / 10 =60000 Depreciation rate under…

Q: HunterX Company purchased pressing machinery that cost P54,000 on January 4, 2023. The entire cost…

A: Annual depreciation = depreciable cost / life of assets = P50,400 / 9 years = P5,600

Q: u Ltd. acquired an excavator on January 1, 2020, for ¥10,000 (all amounts in thousands). This…

A: As per International Financial Reporting Standards (IFRS), fixed assets can be subject to fair value…

Q: On January 1, 2019, Cullumber Corporation acquired machinery at a cost of $1650000. Cullumber…

A: Depreciation is an accounting method used to allocate the cost of a tangible or physical asset over…

Q: Wildhorse Co. purchased machinery that cost $2850000 on January 4, 2019. The entire cost was…

A:

Q: Kentucky Enterprises purchased a machine on January 2, 2019, at a cost of P120,000. An additional…

A: Solution 10: Charging installation cost of P50,000 on repair expense, will result in overstatement…

Q: The Catherine Company, effective January 1, 2020, made the following accounting change: Catherine…

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

Q: On January 1, 2016, Margo Company acquired machinery at a cost of $160,000. This machinery was being…

A: Solution..   Life of the asset = 5 years  Rate of depreciation under double Declining method  = 200%…

Q: Robertson Company had purchased an equipment on January 1, 2019 for P 4,800,000. The entity used the…

A: It is pertinent to note that a change in accounting estimate needs to be accounted for…

Q: 2020. 2. Prepare the correcting entry assuming the error was discovered in 2021 before the adjusting…

A: Straight-line depreciation The simplest direct approach for determining an asset's loss of value…

Q: On April 1, 2010, Sanders Construction paid $10,000 forequipment with an estimated useful life of 10…

A: Double declining balance method :      The depreciation over the fixed assets like equipment,…