Please provide a written step-by-step solution to the problem. Do not use any software in answering the problem so that I could understand how it is solved. Please provide a cash flow diagram or table. Thank you 1. A TV company purchased a machinery for P 100,000.00 on July 1,2015. It is estimated that it will have a useful life of 10 years; scrapvalue of P 4,000.00; production of 400,00 units and working hours of120,000. The company uses the machinery for 14,000 hours in 2015and 18,000 hours in 2016. The machinery produces 36,000 units in2015 and 44,000 units in 2016. Compute the depreciation for 2016using each method given below:a. Straight Line Method(SLM)b. Working Hoursc. Output method

The term Depreciation refers to decrease in the value of asset due to different factors such as…

Answered: Compute the depreciation for 2016

Business

Accounting

Compute the depreciation for 2016

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Please provide a written step-by-step solution to the problem. Do not use any software in answering the problem so that I could understand how it is solved. Please provide a cash flow diagram or table. Thank you

1. A TV company purchased a machinery for P 100,000.00 on July 1,
2015. It is estimated that it will have a useful life of 10 years; scrap
value of P 4,000.00; production of 400,00 units and working hours of
120,000. The company uses the machinery for 14,000 hours in 2015
and 18,000 hours in 2016. The machinery produces 36,000 units in
2015 and 44,000 units in 2016. Compute the depreciation for 2016
using each method given below:
a. Straight Line Method(SLM)
b. Working Hours
c. Output method

Definition Definition Net amount of cash that an entity receives and expends over the course of a given period. For a business to continue operating, positive cash flows are required, and they are also necessary to produce value for investors. Investors in particular prefer to see growing cash flows even after capital expenditures have been paid for (which is known as free cash flow).

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