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On January 1, 2019, Chiz Company acquired equipment to be used in its manufacturing operations. The equipment has an...

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On January 1, 2019, Chiz Company acquired equipment to be used in its manufacturing operations. The equipment has an estimated useful life of 10 years and an estimated residual value of P50,000. The depreciation applicable to this equipment was P240,000 for 2021 computed under the sum of years' digits method. What was the acquisition cost of the equipment? On January 1, 2021, Gringo Company had capitalized cost of P5,000,000 for a new computer software product with an economic life of 5 years. Sales for 2021 amounted to P3,000,000. The total sales of software over its economic life are expected to be P10,000,000. The pattern of future sales cannot be measured reliably. On December 31, 2021, the software had a net realizable value of P4,500,000. What is the carrying amount of the computer software on December 31, 2021?

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1 Calculation of Acquisition Cost of Equipment The depreciation expense for the year 2021 under the View the full answer


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Intermediate Accounting

Intermediate Accounting

ISBN: 978-0324312140

16th Edition

Authors: James D. Stice, Earl K. Stice, Fred Skousen

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Posted Date: March 14, 2023 07:19:23
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