A machine can be bought for P56,000. Other expenses including installation amounted to P4000. The equipment is expected to have a life of 10 years with an estimated value of P7,500 and the cost for dismantling the machine is P2,000. Determine the book value at the end of 6 years by sinking fund method at 12% and by straight line method.
A machine can be bought for P56,000. Other expenses including installation amounted to P4000. The equipment is expected to have a life of 10 years with an estimated value of P7,500 and the cost for dismantling the machine is P2,000. Determine the book value at the end of 6 years by sinking fund method at 12% and by straight line method.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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A machine can be bought for P56,000. Other expenses including installation
amounted to P4000. The equipment is expected to have a life of 10 years with an estimated value of P7,500 and the cost for dismantling the machine is P2,000. Determine the book value at the end of 6 years by sinking fund method at 12% and by
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