The price of a system of jockey pumps is P5,500,000. PLM decided to purchase this system and spent P215,500 for shipping and installation. The equipment will last for 10 years with a salvage  value of 3% of its total cost. Determine the following:  a. Yearly charge of depreciation using SL method. b. Depreciation charge on the 6 th year, and book value at the end of 8th year using SYD  method.

Q: A machine costs P1,800,000. It has a salvage value of P300,000 at the end of 5 years. If money is…

A: Solution: Cost of machine = P1,800,000 Depreciation rate - SLM = 1/5 = 20% Depreciation rate  - DDB…

Q: A piece of equipment has a first cost of P500,000 and the cost of installation is P30,000. If the…

A: Depreciation (Straight Line Method) = (Cost-Salvage Value) / Useful life Depreciation (Sinking Fund…

Q: A printing machine is bought at P 1.5 million and is estimated to have a salvage value of P100,000…

A: The accumulated annual depreciation expense based on units produced is calculated by first dividing…

Q: GoHigher is planning to purchase a machine that will cost $24,000. It has a six-year life with no…

A: The payback period is the number of periods in which the initial investment will be recovered.  It…

Q: Sandhill Inc. wants to purchase a new machine for $37,840, excluding $1,300 of installation costs.…

A: Before investing in new projects or assets, profitability of the project is evaluated by using…

Q: A machine costs Php 500,000 with a salvage value of Php 50,000. Its useful life is six years. The…

A: Depreciation is the decrease in the value of fixed tangible asset due to usage, obsolence or passage…

Q: Company is planning to purchase an new machine for the amount of P90,000, with an estimated useful…

A: In bailout period we consider the cash flow and salvage value and time period required to recover…

Q: A company is evaluating a new 4-year project. The equipment necessary for the project will cost…

A: Initial cost of the project = $2,900,000 Salvage value = $ 655,000 Dpreciation method = 5-years…

Q: The equipment is worth P56,000 with a salvage value of P15,000 at the end of 5 years. If the…

A: Cost of Equipment 56000 Less: Salvage value 15000 Depreciable value 41000 Estimated life 5…

Q: purchase of a motor for P6000 and a generator for P4000 will allow the company to produce its own…

A: Depreciation refers to the decline in the money value of an asset until it gets zero over a certain…

Q: A printing machine is bought at P 1.3 million and is estimated to have a salvage value of P100,000…

A:

Q: A firm is evaluating the acquisition of an asset that costs $68,200 and requires $3,930 in…

A: The annual depreciation is computed as MACRS rate multiplied by asset cost.

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A:

Q: A new machine costs $160 000, has a useful life of 10 years, and can be sold for $15 000 at the end…

A: Note: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question…

Q: A construction company has purchased a motor for P20,000 and a generator for P8,000 to produce its…

A: Depreciation is charged on fixed tangible asset to show the asset on true and accurate value. It is…

Q: What is the depreciation deduction each year, using each of the methods below, for an asset that…

A: Depreciation is the reduction in the value of assets due to normal wear and tear, passage of time,…

Q: A CNC machine costs $240,000. A facility purchases one and plans to use it for 11 years, at which…

A: Declining balance method is an accelerated depreciation method in which the depreciation expenses…

Q: Two years ago, a FN325 Lathe machine was purchased with an estimated salvage value of RM2,000 at the…

A: The Incremental NPV: The incremental investment and the present value of savings from the new…

Q: Henessy Co. is planning to buy a machine costing P84,000 to be depreciated on the straight-line…

A: Payback Period: The payback period is the amount of time it will take for you to recoup the cost of…

Q: A construction company has purchased a motor for P20,000 and a generator for P8,000 to produce its…

A: Annual cost of operation = Depreciation expense + maintenance cost + operation costs

Q: For P450,000, Drax Corporation purchased a new machine with an estimated useful life of five years…

A: The formula for profitability index is  Profitability index =Present value of cash inflows/present…

Q: The initial cost of a paint sand mill, including its installation is P 700,000.00 . The BIR approved…

A: The calculation of annual depreciation under straight line method has been made as follows: Annual…

Q: If the machine is purchased, annual revenues are expected to be $100,000 and annual operating…

A: Pay back period is number of years required to recover initial investment of machine.

Q: Pears Company purchased a new machine on January 1 of this year for an amount of P90,000, with an…

A: At the end of the year Cash inflow Salvage value Cumulative payback 1 P36,000 P20,000 P56,000 2…

Q: A new machine is to be purchased for $200,000. The company believes it will generate $75,000…

A: GIVEN   A new machine is to be purchased for $200,000. The company believes it will generate $75,000…

Q: A commercial company plans to buy the device for $ 20,000 and is expected to sell it for $ 8,000 in…

A: Formula: Straight line method depreciation = ( Asset cost - Salvage value ) / Useful life

Q: Bulldozer cost P12 Million and the cost of installation labor, taxes and miscellaneous expenses is…

A: P 1 Million = P 1000000 P 12 Million = P 12000000 The Cost Of Bulldozer = P 12000000 + P500000 = P…

Q: ABC Printing Corporation is considering purchasing a new printing machine. The following information…

A: Hi there, thanks for posting the questions. But as per our Q&A guidelines, we must answer the…

Q: The Darlington Equipment Company purchased a machine5 years ago at a cost of $85,000. The machine…

A: Calculation of Initial cash flow

Q: An equipment has a first cost of P500,000 and the cost of installation is P30,000. If the salvage…

A: solution : given : cost of asset       =500,000 installation cost =30,000 total Capitalized cost…

Q: use Sinking Fund Method and determine the depreciation at the 5th year.

A: Sinking fund method is a method of depreciation technique. This method helps in taking financing…

Q: A machine was purchased with an amount of P375,000.00 and a modification cost of P100,000.00 after…

A: We have in the Question, Purchase Price = P 375,000       now Modification cost = P 100,000   after…

Q: A new boiler was installed by a textile plant at a cost of P3,000,000 and projected to have a useful…

A: Capitalization costs are the costs incurred by the company for acquiring the assets but are…

Q: Arvada Co. is considering the purchase of equipment that would allow the company to add a new…

A: Capital budgeting is used to evaluate the projects. With the help of capital budgeting, the…

Q: The initial cost of a paint sand mill, including its installation is P806,875. The mill will last…

A: A sinking fund is a method of charging depreciation where every year a fixed amount of depreciation…

Q: An electronics balance costs P88,000 and has an estimated salvage value of P10,000 at the end of ts…

A: Depreciation = ( Cost of the asset - Salvage value ) * Number of years left / Sum of years

Q: The initial cost of an evaporative crystallizer including its installation is P930,000. The approve…

A:

Q: The cost of a Range Rover is 50,000 RO with an estimated life of 8 years and the salvage value is…

A: The depreciation expense is charged on fixed assets as reduced value with the passage of time.

Q: accounting rate of return based on initial investment?

A: Year  1 2 3 4 5 Cash flow 180000 180000 180000 180000 180000 Less: Depreciation (200000)…

Q: The Mellow Machine Company is considering the addition of a computerized lathe to its equipment…

A: Depreciation expense: Depreciation expense is the reduction in a particular asset due to its use or…

Q: A set of Wire Bond machine costs $500,000. This amount includes freight and installation charges…

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

Q: A factory has decided to purchase some new equipment for P650, 000. The equipment will be kept for…

A: Allocating the cost of assets equally throughout the life of the asset is known as the straight-line…

Q: A piece of machinery costs P50,000 and has an anticipated P8,000 salvage value at the end of its…

A: Depreciation Expense: Depreciation expense is the reduction in a particular asset due to its use or…

Q: Beam Company, which is planning to spend P135,000 for a new machine, to be depreciated on a straight…

A: Payback period is the number of periods within which the investment on a project can be recovered in…

Q: cooling water pumping station at a manufacturing plant in Iligan City costs P30,000,000 to…

A: Straight line method charge depreciation equally over the useful life of the assets. Declining…

Q: The equipment in a power station costs 31.2 million Dinars and has a salvage value of 1.2 million…

A: The following computations are done for calculating depreciation for new equipment purchased for…

Q: Required (i)     Calculate the depreciation charge per 100 ml hand sanitizer. (ii)   Prepare a…

A: Depreciation: It is a reduction in the value of assets due to usage of the assets and the passage of…

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.