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Easy Company acquired an equipment on January 1, 2020 for P5,000,000. Depreciation is computed using the straight line method. The estimated useful life of the equipment is five years with no residual value. A specific price index applicable to the equipment was 150 on January 1, 2020 and 225 on December 31, 2020. What amount of depreciation should be reported in the historical cost income statement for 2020? 1. а. 1,000,000 b. 1,500,000 c. 1,125,000 d. 1,250,000 . What amount of depreciation should be reported in the current cost income statement for 2020? a. 1,500,000 b. 1,250,000 c. 1,000,000 d. 2,500,000 3. What is the realized holding gain on the equipment to be reported in 2020? a. 500,000 b. 250,000 c. 300,000 d.

Easy Company acquired an equipment on January 1, 2020 for P5,000,000. Depreciation is computed using the straight line method. The estimated useful life of the equipment is five years with no residual value. A specific price index applicable to the equipment was 150 on January 1, 2020 and 225 on December 31, 2020. What amount of depreciation should be reported in the historical cost income statement for 2020? 1. а. 1,000,000 b. 1,500,000 c. 1,125,000 d. 1,250,000 . What amount of depreciation should be reported in the current cost income statement for 2020? a. 1,500,000 b. 1,250,000 c. 1,000,000 d. 2,500,000 3. What is the realized holding gain on the equipment to be reported in 2020? a. 500,000 b. 250,000 c. 300,000 d.

FINANCIAL ACCOUNTING
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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CHAIN PROBLEM: Kindly provide solution and answer for the 4 questions below:
Problem 23-2 (IAA) on January 1, 2020 and 225 on December 31, 2020. Easy Company acquired an equipment on January 1, 2020 A specific price index applicable to the equipment was 150 Depreciation is computed using the straight line method. The estimated useful life of the equipment is five years with historical cost income statement for 2020? ation in for P5,000,000. P500,000 current residual value. cement What amount of depreciation should be reported in the ember COst of 1. a. 1,000,000 b. 1,500,000 1,125,000 ced in c. d. 1,250,000 . What amount of depreciation should be reported in the current cost income statement for 2020? a. 1,500,000 b. 1,250,000 c. 1,000,000 d. 2,500,000 3. What is the realized holding gain on the equipment to be reported in 2020? a. 500,000 b. 250,000 300,000 C. 4. What is the unrealized holding gain on the equipment to be reported in 2020? d. a. 1,250,000 b. 2,500,000 e. 2,000,000 d. 1,500,000 717
Transcribed Image Text:Problem 23-2 (IAA) on January 1, 2020 and 225 on December 31, 2020. Easy Company acquired an equipment on January 1, 2020 A specific price index applicable to the equipment was 150 Depreciation is computed using the straight line method. The estimated useful life of the equipment is five years with historical cost income statement for 2020? ation in for P5,000,000. P500,000 current residual value. cement What amount of depreciation should be reported in the ember COst of 1. a. 1,000,000 b. 1,500,000 1,125,000 ced in c. d. 1,250,000 . What amount of depreciation should be reported in the current cost income statement for 2020? a. 1,500,000 b. 1,250,000 c. 1,000,000 d. 2,500,000 3. What is the realized holding gain on the equipment to be reported in 2020? a. 500,000 b. 250,000 300,000 C. 4. What is the unrealized holding gain on the equipment to be reported in 2020? d. a. 1,250,000 b. 2,500,000 e. 2,000,000 d. 1,500,000 717
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