Problem 27-3 (IAA)At the beginning of current year, Definite Company acquiredthe following assets:ResidualUseful lifeCostvaluein yearsMachinery310,00010,0005Office equipment 000, 110,000Building10,000101,600,000100,00015Delivery equipment430,00030,0004Required:a. Compute the composite depreciation rate.b. Compute the composite life.cPrepare journal entry to record the depreciation for thecurrent year.Problem 27-4 (ACP) predios fue!Happy Company owned a power plant which consisted of thefollowing assets all acquired at the beginning of current year:ResidualUseful lifeCostvaluein years6,100,000100,00020Building 00Machinery doEquipment14:450,00052,550,0001,030,000000,030,00010Required:a. Compute the composite rate.b. Compute the composite life.c. Prepare journal entry to record the depreciation for thecurrent year following the composite method.d.Prepare journal entry to record the retirement of themachinery at the end of the fifth year assuming the proceedsfrom retirement amount to P40,000.e. Prepare journal entry to record the depreciation for thesixth year following the composite method.MMMWab.d.PrNoderAtP5.accInP2,5At torigfor F1 Wنحنمنهدنندهb.C.d.Was 1ofndProblem 27-1 (IAA)Amicable Company purchased a machine at a cost of P635,000January 1, 2020. It was estimated that the machine wouldI have a residual value of P35,000.onThe estimated useful life is 5 years, 60,000 service hours and150,000 production units.Actual operationsService hoursUnit produced202014,00034,000202113,00032,000202210,00025,000202311,00029,000202412,00030,000Required:Prepare a depreciation table for the following methods:a. Straight lineb. Service hoursc. Production method472Problem 27-2 (IAA)Austere Company purchased machinery for P570,000 on July1, 2020. It is estimated that it will have a useful life of 10 years,residual value of P20,000, production of 200,000 units andworking hours of 50,000.The entity used the machinery for 3,000 hours in 2020 and 5,000hours in 2021.The machinery produced 18,000 units in 2020 and 22,000 unitsin 2021.Required:Compute depreciation for 2020 and 2021:a. Straight lineb. Working hoursc. Output method

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Problem 27-3 (IAA) At the beginning of current year, Definite Company acquired the following assets: Residual Useful life Cost value in years Machinery 310,000 10,000 5 Office equipment 110,000 10,000 10 Building 1,600,000 100,000 15 Delivery equipment 430,000 30,000 4 Required: a. Compute the composite depreciation rate. b. Compute the composite life. C Prepare journal entry to record the depreciation for the current year.

Problem 27-3 (IAA) At the beginning of current year, Definite Company acquired the following assets: Residual Useful life Cost value in years Machinery 310,000 10,000 5 Office equipment 110,000 10,000 10 Building 1,600,000 100,000 15 Delivery equipment 430,000 30,000 4 Required: a. Compute the composite depreciation rate. b. Compute the composite life. C Prepare journal entry to record the depreciation for the current year.

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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