Scroll Inc., a wholly owned subsidiary of Pirn, Inc. began operations on January 1, 20x2. The following information is from the condensed 20x2 income statements of Pirn and Scroll: Pirn P500,000 (350,000) P150,000 Scroll P300,000 Sales Cost of goods sold Gross profit Depreciation Other expenses Income from operations Gain on sale of equipment to Scroll Income before taxes (270,000) P30,000 (40,000) (60,000) 50,000 12,000 P62,000 (10,000) (15,000) P 5,000 P 5,000 Equipment purchased by Scroll from Pirn for P36,000 on January 1, 20x2, is depreciated using the straigh line method over four years. What amount should be reported as depreciation expense in Pirn's consolidated income statements? A. 50,000 B. 47,000 C. 44,000 D. 41,000

Scroll Inc., a wholly owned subsidiary of Pirn, Inc. began operations on January 1, 20x2. The following information is from the condensed 20x2 income statements of Pirn and Scroll: Pirn P500,000 (350,000) P150,000 Scroll P300,000 Sales Cost of goods sold Gross profit Depreciation Other expenses Income from operations Gain on sale of equipment to Scroll Income before taxes (270,000) P30,000 (40,000) (60,000) 50,000 12,000 P62,000 (10,000) (15,000) P 5,000 P 5,000 Equipment purchased by Scroll from Pirn for P36,000 on January 1, 20x2, is depreciated using the straigh line method over four years. What amount should be reported as depreciation expense in Pirn's consolidated income statements? A. 50,000 B. 47,000 C. 44,000 D. 41,000

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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