The ABC Company closes its books every December 31. On August 1, 2011, they bought a machine for P300,000. The machi ne is expected to have a useful life of 10 years with no scrap value. On August 1, 2015, P36,000 was paid for the major overh aul of the machine which extended the life of the machine for another two years. The machine was sold for P185,000 on June 30, 2016. The depreciation expense for the machine for 2015 was: a. P28,750 b. P30,000 C. P27,000 d. P32,000 e. None of the above

The ABC Company closes its books every December 31. On August 1, 2011, they bought a machine for P300,000. The machi ne is expected to have a useful life of 10 years with no scrap value. On August 1, 2015, P36,000 was paid for the major overh aul of the machine which extended the life of the machine for another two years. The machine was sold for P185,000 on June 30, 2016. The depreciation expense for the machine for 2015 was: a. P28,750 b. P30,000 C. P27,000 d. P32,000 e. None of the above

Name: The sale of the machine resulted in a gain/loss ofa.P33,250b.P35,500C
Uploaded: 2024-03-05T11:50:36.000Z
Channel: Bartleby
Description: The sale of the machine resulted in a gain/loss ofa.P33,250b.P35,500C.P39,250d.P6,250eNone of the aboveAnswer (LETTER ONLY): The ABC Company closes its books every December 31. On August 1, 2011, they bought a machine for P300,000. The machine is ex

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

Yam-Hash Corporation currently uses a water purification machine that was purchased 2 years ago. This machine is being depreciated on a straight-line basis, and it has 6 years of remaining life. Its current book value is Rs.2,100, and it can be sold for Rs.2,500 at this time. If old machine is not replaced, then it can be sold for Rs.500 at the end of its useful life. Yam-Hash is offered a replacement machine that has a cost of Rs.8,000, an estimated useful life of 6 years, and an estimated salvage value of Rs.800. This machine falls into the MACRS 5-year class, so the applicable depreciation rates are 20%, 32%, 19%, 12%, 11%, and 6%. The replacement machine is expected to save Rs. 1200 per year. The new machine would require that inventories be increased by Rs.2,000, but accounts payable would simultaneously increase by Rs.500. Yam-Hash fall under tax bracket of 40%, what is the terminal year cash flow?
On January 1, 2017, Northeast Transportation Company purchased a used aircraft at a cost of $58,900,000. Northeast expects the plane to remain useful for five years (7,200,000 miles) and to have a residual value of $4,900,000. Northeast expects to fly the plane 750,000 miles the first year, 1,375,000 miles each year during the second, third, and fourth years, and 2,325,000 miles the last year. Read the requirements. 1. Compute Northeast's depreciation for the first two years on the plane using the straight-line method, the units-of-production method, and the double-declining balance method. a. Straight-line method Using the straight-line method, depreciation is $ for 2017 and $ for 2018.
Fill the blanks XYZ company purchased a new machine on July 1, 2021, at a cost of €50,000. The company estimated that the machine will have a residual value of €10,000. The machine is expected to be used for 10,000 working hours during its 5‐year life. After 6 months, it has been used for 2500 hours and company decides to sell it for 55000. No depreciation has been recorded for the machine. If the company used double declining balance method instead of units-of-activity, the net book value would have been ...blank... and the ...blank... on disposal would have been ...blank...
Pacifica Manufacturing retired a computerized metal stamping machine on December 31, 2023. Pacifica sold the machine to another company and did not replace it. The following data are available for the machine: Cost (installed), Jan. 1, 2018 $920,000 Residual value estimated on Jan. 1, 2018 160,000 Estimated life as of Jan. 1, 2018 8 years The machine was sold for $181,000 cash. Pacifica uses the straight-line method of depreciation. Required: 1. Prepare the journal entry to record depreciation expense for 2023. If an amount box does not require an entry, leave it blank. 2023 Dec. 31 Depreciation Expense fill in the blank ff27e7f9bf8ff9b_2 fill in the blank ff27e7f9bf8ff9b_3 Accumulated Depreciation fill in the blank ff27e7f9bf8ff9b_5 fill in the blank ff27e7f9bf8ff9b_6 2. Compute accumulated depreciation at December 31, 2023.$fill in the blank 302029002fc5075_1 3. Prepare the journal entry to record the sale of the machine. If an…
Choose the correct answer
1
Warhol Enterprises purchased a spray painter at the beginning of 2018 at a cost of $150,000. Costs for training personnel on usage of this painter were $200. Warhol estimated that the spray painter would have a residual value of $30,000. The company decided to use declining-balance method of depreciation at a rate of 20%. Two years later, at the end of 2020, Warhol sold the spray painter for $120,000.a. Calculate the book value of the spray painter at the end of 2018 and the end of 2019, prior to its sale.b. Calculate the gain or loss on the sale of the spray painter.c. Calculate the income statement effect, assuming that Warhol decided to give the spray painter to a charitable foundation.
The Telephone Company of America purchased a numerically controlled production machine 5 years ago for $300,000. The machine currently has a trade-in value of $70,000. If the machine is continued in use, another machine, X, must be purchased to supplement the old machine. Machine X costs $200,000, has annual operating and maintenance costs of $40,000, and will have a salvage value of $30,000 in 10 years. If the old machine is retained, it will have annual operating and maintenance costs of $55,000 and will have a salvage value of $15,000 in 10 years. As an alternative to retaining the old machine, it can be replaced with Machine Y. Machine Y costs $400,000, has anticipated annual operating and maintenance costs of $70,000, and has a salvage value of $140,000 in 10 years. Using a MARR of 15%, a cash flow approach, and a present worth comparison, determine the preferred economic alternative.
James purchased a factory machine of Php 51,000 on January 1, 2015. The machine is expected to have a salvage value of Php 6,000 at the end of its 5 year useful life. During the useful life, the machine is expected to be used for 5,000 hours. The machine was used as under: Years Hours used 2015 1.200 2016 800 2017 1.150 2018 850 2019 1.000
. Jet Co. purchased a machine on 1 July 2017 at a cost of OMR51,000. The machine had an estimated salvage value of OMR3,000 and a life of eight years. The machine was sold for OMR48,600 on 31 December 2019, the last day of the accounting year of the business. To make the sale, the business had to incur dismantling costs and costs of transporting the machine to the buyer's premises. These amounted to OMR1,200. The business uses the straight-line method of depreciation. What was the gain or loss on disposal of the machine?
Daily Enterprises is purchasing a $9.6 million machine. It will cost $46,000 to transport and install the machine. The machine has a depreciable life of five years and will have no salvage value. If Daily uses straight-line depreciation, what are the depreciation expenses associated with this machine? The yearly depreciation expenses are $___________ (Round to the nearest dollar.)
13. Ebasan Company acquired a heavy road transporter on January 1, 2015 at a cost of P10,000,000. The estimated useful life is 10 years. On January 1, 2021, the power train requires replacement, as further maintenance is uneconomical due to the off-road time required. The remainder of the vehicle is perfectly roadworthy and is expected to last for the next four years. The cost of the new power train is P4,500,000. Assuming that the original cost of the power train is P3,000,000, the total depreciation expense in 2021 is A. 2,200,000 B. 1,825,000 C. 1,150,000 D. 1,450,000 14. Assuming that the original cost of the power train is not separately identifiable and the appropriate discount rate is 5%, the total depreciation expense in 2021 is A. 1,000,000 B. 2,500,000 C. 2,934,362 D. 1,789,210