to replace the van. What amount should be reported as gain on disposal of the van in the income statement?
to replace the van. What amount should be reported as gain on disposal of the van in the income statement?
Chapter12: Nonrecognition Transactions
Section: Chapter Questions
Problem 47IIP
Related questions
Question
Transcribed Image Text:Hero had a delivery van which was destroyed in an accident. On that date, the carying amount of the van was P3, 000, 000. On
july 15, the entity receieved and recorded a P50, 000 invoice for a new engine installed in the van in May, and another 100, 000
invoice for various repairs. In August, the entity receieved P4, 200, 000 under an insurance policy on the vn which it plans to use
to replace the van. What amount should be reported as gain on disposal of the van in the income statement?
A) 800,000
B) o
c) 700,000
d) 600,000
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Individual Income Taxes
Accounting
ISBN:
9780357109731
Author:
Hoffman
Publisher:
CENGAGE LEARNING - CONSIGNMENT
Individual Income Taxes
Accounting
ISBN:
9780357109731
Author:
Hoffman
Publisher:
CENGAGE LEARNING - CONSIGNMENT