Use the following information for the next three questions: On December 1, 20x1, Entity A acquired a computed software for P1,000,000 and incurred the following costs: • Non-refundable purchase taxes of P30,000, not included in the purchase price above. • Professional fees incurred in the installation of the software, P100,000. • Modifications to the software before it was brought to the condition intended by management for use, P60,000. Costs of testing the software, P10,000. Training costs of staff who will be using the software, P200,000. Costs of updating the software after it was available for use in the condition originally intended by management, P5,000. • Administrative and other general overhead costs incurred on the acquisition and installation of the software, P15,000. The software's useful life is 5 years.
Use the following information for the next three questions: On December 1, 20x1, Entity A acquired a computed software for P1,000,000 and incurred the following costs: • Non-refundable purchase taxes of P30,000, not included in the purchase price above. • Professional fees incurred in the installation of the software, P100,000. • Modifications to the software before it was brought to the condition intended by management for use, P60,000. Costs of testing the software, P10,000. Training costs of staff who will be using the software, P200,000. Costs of updating the software after it was available for use in the condition originally intended by management, P5,000. • Administrative and other general overhead costs incurred on the acquisition and installation of the software, P15,000. The software's useful life is 5 years.
Chapter14: Property Transactions: Capital Gains And Losses, § 1231, And Recapture Provisions
Section: Chapter Questions
Problem 76P
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Transcribed Image Text:9. Entry to recognize the amortization expense for the current year is
a. Amortization-Intangible Assets
240,000
Computer Software
240,000
b. Amortization-intangible Assets
240,000
Accumulated Amortization-Computer Software
240,000
c. Amortization-Intangible Assets
20,000
Accumulated Amortization-Computer Software
20,000
d. Amortization-Intangible Assets
Computer Software
20,000
20,000
answer and explanation
Transcribed Image Text:Use the following information for the next three questions:
On December 1, 20x1, Entity A acquired a computed software for P1,000,000 and incurred the
following costs:
• Non-refundable purchase taxes of P30,000, not included in the purchase price above.
• Professional fees incurred in the installation of the software, P100,000.
• Modifications to the software before it was brought to the condition intended by
management for use, P60,000.
Costs of testing the software, P10,000.
Training costs of staff who will be using the software, P200,000.
• Costs of updating the software after it was available for use in the condition originally
intended by management, P5,000.
Administrative and other general overhead costs incurred on the acquisition and
installation of the software, P15,000.
The software's useful life is 5 years.
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