Lady Gagarin received a car from Universal Gagarin Corporation for its everyday use. The car was purchased 2 years ago with a cost of P400,000. The car was transferred in the name of Lady Gagarin with a current fair value of P200,000. How much is the grossed-up monetary value? 615,385 307.692

Lady Gagarin received a car from Universal Gagarin Corporation for its everyday use. The car was purchased 2 years ago with a cost of P400,000. The car was transferred in the name of Lady Gagarin with a current fair value of P200,000. How much is the grossed-up monetary value? 615,385 307.692

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Hauswirth Corporation sold (or exchanged) a warehouse in year 0. Hauswirth bought the warehouse…

A: Answer to question a. Purchase cost of warehouse $65,000 Less: Depreciation claimed till year 0…

Q: Yam-Hash Corporation currently uses a water purification machine that was purchased 2 years ago.…

Q: A company provides each of its directors with a car. It has purchased these at £35,000 each. After 4…

A: Depreciation is the amount of expense which shows the decrease in the value of asset over time by…

Q: Ling Ying Wei is operating a hospital to heal wounded people hit by gunfire. She purchased 2 new…

A: >Accounting principle states that the cost of the long term assets (like equipment) is to be…

Q: Jerome bought a factory in June 2004 for £680,000. In August 2020 wishing to move to a more…

A: Purchase in June 2004 for £680,000. Sale in August 2020 for £800,000. calculate the base cost of the…

Q: On 1/4 / 20Χ0, in one of the two large machines used by company X, its gears broke, creating large…

A: Depreciation is the charge on fixed asset which has been used by the company during the period. This…

Q: Liam acquired a machinery purchased for P 1,100,000.00 and paid for transportation charge of P…

A: Depreciation: Depreciation means the reduction in the value of an asset over the life of the assets…

Q: iestion rXYZ r SDA.

A: Dear student , You asked two questions. As…

Q: Brown Company contracts with Sebastian Company to exchange refrigerated trucks. Brown Company will…

A: An exchange is said to have commercial substance if the risk, timing and amount of cash flows…

Q: European University of Lefke has an old bus that originally cost $20000 and has an accumulated…

A: Trade-in allowance is a reduction in the sale price of an asset given by the seller when buyer is…

Q: Robertson Company exchanged a machine for some land. The machine had cost $17,000, was 70%…

A: Formula to compute new machine amount to be recorded:New machine amount = Sale value of the new…

Q: LOQUACIOUS TALKATIVE Co. acquired a piece of factory equipment overseas on a cash basis for…

A: All fixed assets in the business should be capitalised at their purchase cost along with all…

Q: IU purchased a super computer for $15,000. This computer qualifies for 5-year recovery under MACRS.…

A: The after-tax salvage value will be the value after deducting the profit from the sales from SV and…

Q: Lotus purchases a new machine for $20,000, and spends $2,000 on sales taxes, $500 for delivery, and…

A: The capitalization cost includes cost price and other expenses that are incurred for making the…

Q: (1) The company "T" bought from Germany a machine costing 2.000.000€ on 01/04/2016. The useful life…

A: As per standard accounting practice , when we purchase an asset ,…

Q: On January 1, 2020, Zeta Manufacturing purchased a machine for $790,000. The company expected the…

A: Answer:- Depreciation formula (Straight line):- Depreciation = (Cost of equipment - Salvage value)…

Q: Wolf Computer exchanged a machine with a book value of $40,000 and a fair value of $45,000 for a…

A: The Book value is the value of an asset or a company's equity reported on its financial statements,…

Q: Francis Company purchased a machine for $24, 000; the seller is holding the note. Francis Company…

A: Property, plant, and equipment refers to those assets which are long-term in nature and are used by…

Q: Ling Ying Wei is operating a hospital to heal wounded people hit by gunfire. She purchased 5 new…

A: Depreciation: Depreciation means the reduction in the value of an asset over the life of the assets…

Q: Maxa Marina exchanged a boat with a cost of $80,000 (now 75% depreciated) and fair value of $25,000…

A: Value to be recorded the new boat = Fair Value of asset given if available

Q: n July 1, 2004, the national government granted a parcel of land located in Baliuag, Bulacan to…

A: Accounting for government grants has two approaches, the first is the capital approach and the…

Q: An office furniture costing $110,000 has a useful life of 10 years. Fedex took $1200 to deliver and…

A: Solution- Office furniture is a 7 year property which is place to service in the forth quarter so we…

Q: A state owns a machine that produces license plates. Due to the required technological changes to…

A: Impairment of assets means reducing the book value of assets when carrying amount is more than…

Q: Katak purchased a Toyota Kluger for $70,000. She purchased the vehicle on 15 September 2021.

A: Generally, within the first year, cars depreciate up to 20% of their value per annum. Therefore,…

Q: Wolf Computer exchanged a machine with a book value of $40,000 and a fair value of $45,000 for a…

A: Loss or gain on the exchange = Fair value of asset - Book value of asset

Q: ABC Corp. sold goods to the Bureau of Internal Revenue in the amount of Php 100,000.00 after winning…

A: VAT due refers to the amount of Value Added Tax (VAT) that a business or individual is required to…

Q: The truck manufacturer purchased $2,000 in intermediate goods produced this year by domestic firms…

Q: Two friends create a company called Dream at the beginning of 2017. They each contributes with 20…

A: Let's calculate the cost of goods sold (COGS) for the period.Cost of Raw Materials Purchased:Total…

Q: A civil engineer bought a crane for erecting tall buildings. It was invoiced from Japan (Cost,…

A: Introduction:- First we need to calculate straight-line method of depreciation rate Cost of the…

Q: Yam-Hash Corporation currently uses a water purification machine that was purchased 2 years ago.…

A: In the above question we have asked to calculate terminal year(6th) cash flow which is as below .

Q: Traded the company car (Automobile) for a newer one at Plume Motors. The old car originally cost…

A: Trade in proceeds Dr. $5500 Accumulated depreciation. Dr $19000…

Q: On july 1, 2021, PAOLO exchanged its-non-monetary asset (equipment) with YEN's non-monetary asset…

A: The exchange has significantly changed the cash flows of each entity. the value of new assets will…

Q: ents plus the interest on the remaining loan. What was the amount of the loan? What was the amount…

A: in this problem payment is made by four equal payment plus interest on remaining amount.

Q: During 2009, Aisin Seiki Limited sold 2,000 square meters of prime commercial zoned land to a…

A: Cash Received in 2009=Down Payment=¥1,000,000Total Selling Price=Total Selling Price of…

Q: ZY Corporation exchanges its old equipment and USD100,000 cash for new equipment. The old equipment…

A: The cost of new equipment is calculated as sum of book value of old asset and cash paid for…

Q: b. SYD Method YEAR BOOK VALUE AT THE DEPRECIATION CHARGE BOOK VALUE AT THE BEGINNING OF THE YEAR…

A: Depreciation is an expense but a non-cash expense which is shown in the income statement. It is a…

Q: Yam-Hash Corporation currently uses a water purification machine that was purchased 2 years ago.…

Q: Q4: China Beijing Salon purchased new furniture for its store on April 1, 2001. The furniture is…

A: Introduction The cost of assets which should be capitalized includes all the expenses incurred on…

Q: Information Processing, Inc. (IPI) exchanges its used machine for a new machine with Jerrod Business…

A: The acquisition of assets is a part of business activities. When the company disposes of the asset…

Q: A taxpayer engaged in manufacturing operations bought a machine with a salvage value of Php 50,000…

A: The carrying value of machine is calculated as original cost less cumulative depreciation for 2…

Q: On March 1, 2019, Extreme Company exchanged an old machine having a cost of and accumulated…

A: The non cash assets acquired in exchange process is recorded at fair market value in the accounting…

Q: Cattle Co. purchased cattle for P200, 000 on July 1, 2021. The cost of transporting the same to the…

Concept explainers

Capital Gain

Any capital asset when sold can give the seller a higher or lower price from its purchase price leading to a capital gain or capital loss. The time period of holding an asset is decided based on if it is a long term or short-term capital gain. On that basis, the rate of taxation is decided if it is 20%, 15% or according to the tax brackets. The rate of taxation differs in the case of equity or debt, whether long or short term. The capital gain can be adjusted from capital loss to arrive at a net capital gain. The amount of gains and the exemption has to be reported in the tax return filed in the financial year in which the asset was transferred. The tax return can be filed quarterly, monthly, semi-annually or annually.

Question

Lady Gagarin received a car from Universal Gagarin Corporation for its
everyday use. The car was purchased 2 years ago with a cost of
P400,000. The car was transferred in the name of Lady Gagarin with a
current fair value of P200,000. How much is the grossed-up monetary
value?
615,385
307,692
61,538
30,769
None of the above

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Dietz owned a delivery van with a Cost of $ 12,000 and Accumulated Depreciation of $10,000. It traded this old van for a new one that cost $16,000. The dealer allowed Dietz a trade-in allowance of $3,500 on the old van, and Dietz paid the remainder in cash. Compute the following: i) Gain on Disposal of Old Van
Andrew works as a sales and marketing consultant for Hisense Australia. As part of his work, he purchased a Mercedes van on 1 January 2022 for $60,000. The vehicle has an effective life of 8 years and is used 50% for business purposes. Required: Calculate the depreciation allowable in relation to the vehicle for the year ended 30 June 2023. Use the Diminishing Value Method. (based on australia taxation law)
Please explain Pizza corporation factory was destroyed by a hurricane. The fair market value of the factory at the time of the hurricane was $500,000 and its adjusted basis was $750,000. Pizza received insurance proceeds of $620,000, which it used to immediately buy a new factory. What gain or loss will pizza recognize related to the factory in the current year? $120,000 gain $250,000 loss No gain or loss $130,000 loss
1. Miss Bae provided information to the government, which led the capture andseizure of smuggled goods with FMV of P 20, 000, 000. If the governmentdestroyed the goods seized because these are regarded as harmful to health,how much cash reward would Ms. Bae receive? 2.In 200A, Mr. Rosario acquired his principal residence for P6,000,000. He soldit to Mr. Dela Cruz for P12,000,000 in 200D. Within 30 days, he wrote the BIR fortax exemption because he intends to use the entire sales proceeds to purchase anew principal residence. How much is the basis of the new residence for taxationpurposes if he actually acquired for P15,000,000?
A firm is planning to purchase a new machine costing ₱2,600,000 with freight and installation costs amounting to 125,000. The old unit to be traded-in will be given a trade-in allowance of ₱240,000. Other assets that are to be retired as a result of the acquisition of the new machine can be salvaged and sold for ₱52,000. The loss on the retirement of these assets is ₱50,000 will reduce taxes by ₱20,000 which is based on a tax rate of 40%. If the new machine is not purchased, extensive repairs on the old machine will have to be made at an estimated cost of ₱350,000. This cost can be avoided by purchasing the new machine. Additional gross working capital of ₱250,000 will be needed to support operations planned with the new machine. The net cost of investment would be? ₱2,725,000 ₱2,313,000 ₱2,063,000 ₱2,485,000 ₱2,973,000 ₱2,413,000
Daschle LLC completed some research and development in the US, during June of the current year. The related costs were $72,000. How much amortization may Daschle deduct during the current year Multiple Choice O $0 $8.200 $7,700 $14,400 None of the choices we conect
What is the book value of an equipment after 3 years using SOYD if it has economic life of 7 years and with FC of ₱220000? The salvage of the equipment is ₱30000. a. ₱106428.86 b. ₱115633.21 c. ₱109377.77 d. ₱111791.11
3
This topic is about Property, Plant, and Equipment Based on the problem, What is the cost of the machine acquired in the exchange? How much is the gain on the exchange?
19. Ali sells a machine for RM50,000 cash on 30 April 2020. The machine cost RM100,000 when it was purchased and has a carrying value of RM65,000 at the date of disposal. What are the journal entries to record the disposal of the machine? a) Dr Accumulated depreciation RM35,000 : Dr Loss on disposal RMI5,000 ; Dr Cash RM50,000; Cr Non- current assets - cost RM100,000 b) Dr Accumulated depreciation RM65,000 ; Dr Loss on disposal RM35,000; Cr Non-current assets - cost RM100,000 c) Dr Accumulated depreciation RM35,000 ; Dr Cash RM50,000 : Cr Non-current assets RM65,000: Cr Profit on disposal RM20,000 d) Dr Non-current assets RM65,000 ; Dr Accumulated depreciation RM35,000 ; Cr Cash RMS0,000 ; Cr Profit on disposal RM50,000
Kiko group of companies exchanged a car from its inventory for a computer system to be used in its technological upgrading project. The following information relates to this exchange that took place on July 16, 2021.Listed selling price of the car-90,000FV of the computer system-86,000Carrying amount of the car-60,000If Kiko group of companies recognized a gain on this exchange of P160,000, how much was the amount paid to complete the transaction
Alfredo Company purchased a new 3-0 printer for $960,000. Although this printer is expected ro last for ten years, Alfredo knows the technology will become old quickly, and so they plan to replace this printer in three years. At that point, Allredo believes it will be able to sell the printer for $10,000. Calculate yearly depr eciation using the double-declining-belance method. Round final answers to nearest whole dollar amount. Year 1 316,667 x Year 2 $ 316,667 x Year 3 Feedback Y Check My Work The double-declining balance uses 'double the straight-line rate for depreciation. The 'base' that is used to apply that rate is the book value of the asset (determined by subtractino the balance in the accumulated depreciation account from the original cost of the asset).