PROBLEM 3: Grisha Company owns a milling machine that cost P700,000 and has accumulated depreciation of P390,000 as of December 31. 2019. The machine was acquired on January 1, 2017. It has been depreciated over 5 years using the straight-line method. Estimated residual value is P50,000.The company decided to dispose the milling machine on July 1, 2020. Requirements: a) Compute the net book value of the machine at disposal date. b) Prepare the entry to record the disposal of the machine under each of the following indeþendent situations. 1. The machine needed extensive repairs, and it was not worth repairing. Grisha disposed of the machine, receiving nothing in return. 2. Grisha sold the machine for P280,000 cash. 3. Grisha exchanged its old machine to Ravka Inc. for a new machine. The fair value of the new machine is P178,000 while the fair value of the old machine is P190,000. Grisha receives additional P12,000 cash.

PROBLEM 3: Grisha Company owns a milling machine that cost P700,000 and has accumulated depreciation of P390,000 as of December 31. 2019. The machine was acquired on January 1, 2017. It has been depreciated over 5 years using the straight-line method. Estimated residual value is P50,000.The company decided to dispose the milling machine on July 1, 2020. Requirements: a) Compute the net book value of the machine at disposal date. b) Prepare the entry to record the disposal of the machine under each of the following indeþendent situations. 1. The machine needed extensive repairs, and it was not worth repairing. Grisha disposed of the machine, receiving nothing in return. 2. Grisha sold the machine for P280,000 cash. 3. Grisha exchanged its old machine to Ravka Inc. for a new machine. The fair value of the new machine is P178,000 while the fair value of the old machine is P190,000. Grisha receives additional P12,000 cash.

Name: PROBLEM 3: Grisha Company owns a milling machine that cost P700,000 a
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Description: PROBLEM 3: Grisha Company owns a milling machine that cost P700,000 andhas accumulated depreciation of P390,000 as of December 31, 2019. Themachine was acquired on January 1, 2017. It has been depreciated over 5 yearsusing the straight-line method.

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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