Required:Compute for the following:Gain or loss on sale of Asset PTotal depreciation expense for 2021Adjusted cost of PPE as of Dec. 31, 2021Carrying amount of PPE as of Dec. 31, 2021 Unseld, Inc.'s property, plant and equipment at Dec. 31, 2020:PP175,000RP255,0002016Original costYear PurchasedUseful lifeSalvage valueDepreciationmethodP400,000201910 yearsP25,000Double-decliningbalanceP400,0002017201510 yearsP15,50075,000 hoursP15,00015 yearsP25,000SYDActivityStraight-lineAdditional information:1. In the year an asset is purchased, Unseld, Inc. does not record anydepreciation expense on the asset.2. In the year an asset is retired or traded in, Unseld, Inc. takes fullyear depreciation on the asset.3. On May 5, Asset P was sold for P65,000 cash.4. Asset R was used for 10,500 hours during 2021. Accumulatedusage as of Dec. 31, 2020 is 40,800 hours.5. On Dec. 31, before computing depreciation expense on Asset T,the management of Unseld, Inc. determined that the useful liferemaining from Jan. 1, 2021 is only 10 years.6. On Dec. 31, it was discovered that a plant asset purchased in 2020had been expensed completely in that year.P110,000 and has useful life of :10 years and no salvage value.Management has decided to use the double-declining balance forthis asset, which can be referred to as "Asset I."This asset costsRequired:Compute or the following:1. Gain or loss on sale of Asset P2. Total depreciation expense for 20213. Adjusted cost of PPE as of Dec. 31, 20214. Carrying amount of PPE as of Dec. 31, 2021

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Unseld, Inc.'s property, plant and equipment at Original cost Year Purchased Useful life Salvage value P P175,000 2015 10 years P15,500 SYD Depreciation method Additional information: R P255,000 2016 75,000 hours P15,000 Activity Dec. 31, 2020: I P400,000 2017 15 years P25,000 Straight-line с P400,000 2019 10 years P25,000 Double-declining balance

Unseld, Inc.'s property, plant and equipment at Original cost Year Purchased Useful life Salvage value P P175,000 2015 10 years P15,500 SYD Depreciation method Additional information: R P255,000 2016 75,000 hours P15,000 Activity Dec. 31, 2020: I P400,000 2017 15 years P25,000 Straight-line с P400,000 2019 10 years P25,000 Double-declining balance

FINANCIAL ACCOUNTING

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ISBN:9781259964947

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Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Required:

Compute for the following:

Gain or loss on sale of Asset P
Total depreciation expense for 2021
Adjusted cost of PPE as of Dec. 31, 2021
Carrying amount of PPE as of Dec. 31, 2021

Unseld, Inc.'s property, plant and equipment at Dec. 31, 2020:
P
P175,000
R
P255,000
2016
Original cost
Year Purchased
Useful life
Salvage value
Depreciation
method
P400,000
2019
10 years
P25,000
Double-declining
balance
P400,000
2017
2015
10 years
P15,500
75,000 hours
P15,000
15 years
P25,000
SYD
Activity
Straight-line
Additional information:
1. In the year an asset is purchased, Unseld, Inc. does not record any
depreciation expense on the asset.
2. In the year an asset is retired or traded in, Unseld, Inc. takes full
year depreciation on the asset.
3. On May 5, Asset P was sold for P65,000 cash.
4. Asset R was used for 10,500 hours during 2021. Accumulated
usage as of Dec. 31, 2020 is 40,800 hours.
5. On Dec. 31, before computing depreciation expense on Asset T,
the management of Unseld, Inc. determined that the useful life
remaining from Jan. 1, 2021 is only 10 years.
6. On Dec. 31, it was discovered that a plant asset purchased in 2020
had been expensed completely in that year.
P110,000 and has useful life of :10 years and no salvage value.
Management has decided to use the double-declining balance for
this asset, which can be referred to as "Asset I."
This asset costs
Required:
Compute or the following:
1. Gain or loss on sale of Asset P
2. Total depreciation expense for 2021
3. Adjusted cost of PPE as of Dec. 31, 2021
4. Carrying amount of PPE as of Dec. 31, 2021

Definition Video Definition Accounting method wherein the cost of a tangible asset is spread over the asset's useful life. Depreciation usually denotes how much of the asset's value has been used up and is usually considered an operating expense. Depreciation occurs through normal wear and tear, obsolescence, accidents, etc. Video

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