ABC Company replaced some parts of its factory building as well as its annual maintenance and upkeep during 2020:The outside corrugated covering of the factory wall was removed and replaced. The job was done by an expert crew from Bayani Construction Company and will extend the life of the building by 4 years. The cost of the new wall was ₱600,000. The cost of the old wall is estimated to be ₱200,000. The building is 25% depreciated.General maintenance and tune up to its factory equipment in order to maintain their current projected capacity were incurred at a cost of ₱150,000.Dust filters in the interior of the factory were replaced at a cost of ₱300,000. The new filters are expected to reduce employee health hazards and thus reduce wage and fringe benefit costs. The original filters cost ₱100,000.What is the total amount to be expensed from the given expenditures of ABC Company?₱1,150,000₱900,000₱450,000₱150,000

This question deals with the IAS 16 - property, plant and equipment. As per the IAS 16, property…

Answered: ABC Company replaced some parts of its…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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ABC Company replaced some parts of its factory building as well as its annual maintenance and upkeep during 2020:

The outside corrugated covering of the factory wall was removed and replaced. The job was done by an expert crew from Bayani Construction Company and will extend the life of the building by 4 years. The cost of the new wall was ₱600,000. The cost of the old wall is estimated to be ₱200,000. The building is 25% depreciated.
General maintenance and tune up to its factory equipment in order to maintain their current projected capacity were incurred at a cost of ₱150,000.
Dust filters in the interior of the factory were replaced at a cost of ₱300,000. The new filters are expected to reduce employee health hazards and thus reduce wage and fringe benefit costs. The original filters cost ₱100,000.

What is the total amount to be expensed from the given expenditures of ABC Company?

₱1,150,000
₱900,000
₱450,000
₱150,000

Definition Definition Benefits in addition to compensation that companies give to their employees. Fringe benefits can boost morale and productivity and keep employees motivated. Companies often use fringe benefits as a competitive advantage to recruit and retain employees. Examples of fringe benefits include pensions, vacation time, tuition reimbursement, free or subsidized meals, and gym memberships.

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