On January 1, 2018, an entity purchased a machine for P7,200,000 and depreciated it by the straight line method using an estimated useful life of eight years with no residual value. On January 1, 2020, the entity determined that the machine had a useful life of six years from the date of acquisition with a residual value of P600,000. What is the accumulated depreciation on December 31, 2020? a. 4,200,0003,600,0003,000,0004,600,000 On January 1, 2018, an entity purchased for P5,000,000 a machine with useful life of ten years and residual value of P200,000. The machine was depreciated by the double declining balance method. The entity changed to the straight-line method on January 1, 2020 and the residual value did not change. What is the carrying amount of the asset on December 31, 2020? a. 2,825,0002,800,0002,625,0003,200,000

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Description: On January 1, 2018, an entity purchased a machine for P7,200,000 and depreciated it by the straight line method using an estimated useful life of eight years with no residual value. On January 1, 2020, the entity determined that the machine had a use

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FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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On January 1, 2018, an entity purchased a machine for P7,200,000 and depreciated it by the straight line method using an estimated useful life of eight years with no residual value. On January 1, 2020, the entity determined that the machine had a useful life of six years from the date of acquisition with a residual value of P600,000. What is the accumulated depreciation on December 31, 2020? a. 4,200,000
1. 3,600,000
2. 3,000,000
3. 4,600,000

On January 1, 2018, an entity purchased for P5,000,000 a machine with useful life of ten years and residual value of P200,000. The machine was depreciated by the double declining balance method. The entity changed to the straight-line method on January 1, 2020 and the residual value did not change. What is the carrying amount of the asset on December 31, 2020? a. 2,825,000
1. 2,800,000
2. 2,625,000
3. 3,200,000

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