Red Velvet Services has the following assets as of December 31, 2017Date Acquired4.Salvage ValueP1,500,000Useful LifeCostP16,000,00010 years5 yearsBuildingJan. 1, 201550,000July 1, 2016March 1, 20177,000,0001,900,000Furniture & FixturesEquipment8 years100,000Required:Cive the adjusting entOTecord utpretiatioITTOr each asset in 2015, 2010, dnu 2017Give the depreciation expense of each asset TOI Cach yearOive thed. Give the entry on March 1, 2018 when the equipment was sold for P500,000b.tien of each accot foreach voarC.

Name: Red Velvet Services has the following assets as of December 31, 2017D
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Description: Red Velvet Services has the following assets as of December 31, 2017Date Acquired4.Salvage ValueP1,500,000Useful LifeCostP16,000,00010 years5 yearsBuildingJan. 1, 201550,000July 1, 2016March 1, 20177,000,0001,900,000Furniture & FixturesEquipment8 ye

Depreciation as per straight line method(Since no method is specified assuming SLM) = (Cost-…

Business

Accounting

Red Velvet Services has the following assets as of December 31, 2017 Cost P16,000,000 7,000,000 4. Useful Life 10 years 5 years Salvage Value P1,500,000 50,000 Date Acquired Building Jan. 1, 2015 July 1, 2016 March 1, 2017 Furniture & Fixtures Equipment 8 years 1,900,000 100,000 Required: Cive the adjusting n tOTecord uepretiatioITTOr each asset in 20I5, 2010, dnu z017 Give the depreciation expense of eath asset TOr Cach year Oive the d. Give the entry on March 1, 2018 when the equipment was sold for P500,000 b. tion efe hacset foroach voar C.

Red Velvet Services has the following assets as of December 31, 2017 Cost P16,000,000 7,000,000 4. Useful Life 10 years 5 years Salvage Value P1,500,000 50,000 Date Acquired Building Jan. 1, 2015 July 1, 2016 March 1, 2017 Furniture & Fixtures Equipment 8 years 1,900,000 100,000 Required: Cive the adjusting n tOTecord uepretiatioITTOr each asset in 20I5, 2010, dnu z017 Give the depreciation expense of eath asset TOr Cach year Oive the d. Give the entry on March 1, 2018 when the equipment was sold for P500,000 b. tion efe hacset foroach voar C.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Concept explainers

Depreciation Methods

The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.

Depreciation Accounting

In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.

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Question

Red Velvet Services has the following assets as of December 31, 2017
Date Acquired
4.
Salvage Value
P1,500,000
Useful Life
Cost
P16,000,000
10 years
5 years
Building
Jan. 1, 2015
50,000
July 1, 2016
March 1, 2017
7,000,000
1,900,000
Furniture & Fixtures
Equipment
8 years
100,000
Required:
Cive the adjusting en
tOTecord utpretiatioITTOr each asset in 2015, 2010, dnu 2017
Give the depreciation expense of each asset TOI Cach year
Oive the
d. Give the entry on March 1, 2018 when the equipment was sold for P500,000
b.
tien of each accot foreach voar
C.

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