49 02505 084560September 1, to 1, The totaledgovernment to in ABC Co.'s drive in a nearby creek.On 1, 20x1, ABC grant theThe ABC Co. 6 to completeAdapted)perationsPresentationonstre of P6,000,000. The building is estimated to have a usefulaE ABC Co. uses the gross presentation, how much is theincomeIf ABC Co. uses the gross presentation, how much is thecarrving amount of the building on December 31, 20x2?, If ABC Co. uses the gross presentation, how much is theincome from the government grant in 20x2?&If ABC Co. uses the gross presentation, how much is thedepreciation expense in 20x2?9. If ABC Co. uses the gross presentation, how much is thebalance of the deferred income from government grant onDecember 31, 20x2?10. If ABC Co. uses the net presentation, how much is thecarrying amount of the building on December 31, 20x2?II. If ABC Co. uses the net presentation, how much is thedepreciation expense in 20x1?oe the following information for the next three questions:at August 1, 20x1, ABC Co. received P1,800,000 grant from theSovernment to aid in ABC Co.'s clean-up drive in a nearby creek.e cleanup took ABC Co. 6 months to completefromPlember 1, 20x1 to March 1. 20x2. The clean-up costs totaled2,700,000 and were incurred evenly. 20x3 is P1,400,000.the 31, 20x3 is P400,000.PROBLEM 1: OR FALSEdeferred in the 31,10. If X uses the amount of the9. If X the expense in265PROBLEMS:Fact patternIn 20dition that the money shall be used to construct a building.he tuction was started in 20X1 and was completed on DecemberCos for a total construction cost of P6M. The building isThe grant is considered a grant related to asset., The income from the government grant in 20x1 is P200,000.1 Entity X shall not recognize any income from the governmentgrant until the building is constructed and depreciation startsto be recognized.4. If no depreciation is recognized on the building, no income isalso recognized from the government grant.5. Income from government grant recognized in 20x2 is P200,000.6. If Entity X uses gross presentation, the carrying amount of thebuilding in the December 31, 20x2 financial statements is P6M.1. If Entity X uses net presentation, the carrying amount of thebuilding in the December 31, 20x2 financial statements is P4M.* If Entity X uses gross presentation, the depreciation expensé inthe December 31, 20x3 financial statements is P600,000.* If Entity X uses net presentation, the depreciation expense inthe December 31, 20x3 financial statements is P400,000.*. It Entity X uses gross presentation, the carrying amount of thedeferred income from government grant in the December 31.20x3 financial statements is P1,400,000.SSROOM DISCUSSION

Government grant refers to the monetary assistance provided by the government to some enterprise in…

seven questions: the of 30 years and a residual value of P1,000,000. cost of P6,000,000. The building is estimated to have a usefu ernment to aid in the construction of a new building. The Tanuary 1, 20x1, ABC Co. received P2,000,000 grant from the truction of the building was finished on March 31, 20x2 for = etion of the building was finished on March 31, 202 fo of P6,000,000. The building is estimated to have a usefu

seven questions: the of 30 years and a residual value of P1,000,000. cost of P6,000,000. The building is estimated to have a usefu ernment to aid in the construction of a new building. The Tanuary 1, 20x1, ABC Co. received P2,000,000 grant from the truction of the building was finished on March 31, 20x2 for = etion of the building was finished on March 31, 202 fo of P6,000,000. The building is estimated to have a usefu

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

1
Compare three alternatives on the basis of their capitalized costs at i = 13% per year and select the best alternative. Alternative E F G First Cost $-85,000 $-325,000 $-825,000 AOC, per Year $-65,000 $-20,000 $-6,000 Salvage Value $25,000 $75,000 $500,000 Life, Years 2 4 ∞ The capitalized cost of alternative E is $ , alternative F is $ , and alternative G is $ . The best alternative is E G F .
Problems 43 and 44 are based on the following statement: Used New machine machine Initial Cost 15,000 40,000 ($) Annual 8,000 2,000 operating cost ($/year) Salvage 5,000 10,000 value ($) Life (years) 3 6 Use an interest rate of 10% per year 43. The present worth of the new machine is closest to: (A) $43,630 (B) $43,066 (C) $45,210 (D) $49,660 44. To compare the machines on the basis of a present worth analysis, the present worth values to use are: (A) PWused $31,139, PW new = $43,066 (B) PWused $31,139, PW new = $37,461 (C) PWused $54,533, PW new = $43,066 (D) PWused $54,533, PW new = $37,461
Its required to select one of the two machines, if you know that the firms MARR-12% and if the costs are shown below: Project A Project B Initial cost, $ 7650 12900 Maintenance cost, S/year 1200 900 Salvage value, $ 2000 Economic life, year 4 Compare the two-alternative using: 1-Equavlent Annual worth comparison. 2- Present worth comparison
10
Joulu the fleet be replaced? 12-31. (Calculating replacement project cash flows) The Minot Kit Aircraft Com a The cutter has a remaining $80,000 book value that is being depreciated $20,000
A company, XYZ, bought a machine for BD 250,000 which has a useful life of 10 years and can be sold for BD50,000 at the end of its useful life In addition, the cost of installing the machine is BD25,000 while the cost of dismantling is BD 7,500. Determine the book value at the end of 8 year using sinking fund if interest is 12% a BD112,044 b BD122,899 c. BD128,450 d B0115355
Funds committed to a project of Triumph Ltd. are Rs.25 lakh. The inflows relating to the project for the six years areRs.7,50,000; Rs.8,00,000; Rs.6,50,000; Rs.6,00,000; Rs.5,50,000 and Rs.4,50,000 respectively; compute the IRR of theproject and unrecovered investment balance at the end of year 4.
Determine the capitalized cost of a permanent roadside historical marker that has a first cost of $60,000 and a maintenance cost of $1,900 once every 7 years. Use an interest rate of 12% per year. The capitalized cost is $