Exercise 2 Directions: Solve the given problems { 3 points each} 1. A firm purchased equipment on May 1, 2019 for P 60,000. It is estimated that the equipment will have a P 6,000 residual value at the end of its ten-year useful life. Using the Straight line Method of Depreciation, what will be the balance of the Accumulated Depreciation account on December 31,2021. 2. Ethan Company uses the allowance method in estimating doubtful accounts. During the first year of operations, credit sales total P 1,300,000 but 60% of this amount have been collected. It is the policy of the company to set up 3% of the outstanding receivables. For the current year, at what amount should Doubtful Account Expense be presented in the income statement? 3. Aegean Airlines purchased a five year insurance policy for its airlines on June 1, 2019 for the amount of P150,000 and debited it to an asset account. The company uses a calendar as its accounting period. Assuming that June 1 is the effective date of the policy, How much is the correct balance for the Prepaid Insurance account on December 31,2019.