Jayanne Co. acquired an equipment for P4,200,000 in 2017. The policy is straight line depreciation, full depreciation in the year of acquisition and no depreciation in the year of disposal. The useful life is five years with residual value of P200,000. On July 1, 2020, the equipment was sold for P2,500,000. What is the gain on disposal in 2020? A. 700,000 B. 820,000 C. 500,000 D. 400,000
Jayanne Co. acquired an equipment for P4,200,000 in 2017. The policy is straight line depreciation, full depreciation in the year of acquisition and no depreciation in the year of disposal. The useful life is five years with residual value of P200,000. On July 1, 2020, the equipment was sold for P2,500,000. What is the gain on disposal in 2020? A. 700,000 B. 820,000 C. 500,000 D. 400,000
Chapter11: Property Dispositions
Section: Chapter Questions
Problem 64P
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Question
Jayanne Co. acquired an equipment for P4,200,000 in 2017. The policy is straight line
depreciation in the year of acquisition and no depreciation in the year of disposal. The useful life is five years
with residual value of P200,000. On July 1, 2020, the equipment was sold for P2,500,000. What is the gain
on disposal in 2020?
A. 700,000
B. 820,000
C. 500,000
D. 400,000
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