On January 1, 2022, Kent Company purchased a machine for P5,000,000. The entity paid shipping cost...

 

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On January 1, 2022, Kent Company purchased a machine for P5,000,000. The entity paid shipping cost P50,000 as well as installation cost of P120,000. The machine was estimated to have a useful life of 10 years, an estimated residual value of P300,000 and the straight line method is used. In January 2023, additions costing P360,000 were made to the machine in order to comply with pollution control ordinances. These additions neither prolonged the life of the machine nor did they have any residual value. What amount should be recorded as depreciation for 2023? Problem 28-19 (IAA) On January 1, 2022, Zoe Company showed accumulated depreciation on machinery with a balance of P3,700,000. On December 31, 2022, after the adjusting entries were posted, the accumulated depreciation showed a balance of P3,900,000. During 2022, a machine costing P1,300,000 was sold for P500,000 cash. The transaction resulted in a loss of P100,000. No other asset was disposed of during the current year. 1. What amount was recorded as accumulated depreciation on machine sold? 2. What amount was recorded as depreciation for 2022? Parable Company revealed the following depreciation policy on machinery: • A full year depreciation is taken in the year of acquisition. No depreciation is taken in the year of disposition. The estimated useful life is five years. The straight line method is used. On June 30, 2022, the entity sold for P2,300,000 a machine acquired in 2019 for P4,200,000. The estimated residual value was P600,000. What amount of gain on disposal should be recorded in 2022? Problem 28-17 (AICPA Adapted) Weir Company used straight line depreciation for the property, plant and equipment which consisted of the following at the end of each year: Land Building Machinery and equipment Accumulated depreciation 2022 250,000 1,950,000 6,500,000 3,700,000 2023 250,000 1,950.000 6,950,000 4,000,000 The depreciation expense for 2022 and 2023 was P500,000 and P550,000, respectively. What amount was debited to accumulated depreciation during 2023 because of property, plant and equipment retirement? On January 1, 2022, Kent Company purchased a machine for P5,000,000. The entity paid shipping cost P50,000 as well as installation cost of P120,000. The machine was estimated to have a useful life of 10 years, an estimated residual value of P300,000 and the straight line method is used. In January 2023, additions costing P360,000 were made to the machine in order to comply with pollution control ordinances. These additions neither prolonged the life of the machine nor did they have any residual value. What amount should be recorded as depreciation for 2023? Problem 28-19 (IAA) On January 1, 2022, Zoe Company showed accumulated depreciation on machinery with a balance of P3,700,000. On December 31, 2022, after the adjusting entries were posted, the accumulated depreciation showed a balance of P3,900,000. During 2022, a machine costing P1,300,000 was sold for P500,000 cash. The transaction resulted in a loss of P100,000. No other asset was disposed of during the current year. 1. What amount was recorded as accumulated depreciation on machine sold? 2. What amount was recorded as depreciation for 2022? Parable Company revealed the following depreciation policy on machinery: • A full year depreciation is taken in the year of acquisition. No depreciation is taken in the year of disposition. The estimated useful life is five years. The straight line method is used. On June 30, 2022, the entity sold for P2,300,000 a machine acquired in 2019 for P4,200,000. The estimated residual value was P600,000. What amount of gain on disposal should be recorded in 2022? Problem 28-17 (AICPA Adapted) Weir Company used straight line depreciation for the property, plant and equipment which consisted of the following at the end of each year: Land Building Machinery and equipment Accumulated depreciation 2022 250,000 1,950,000 6,500,000 3,700,000 2023 250,000 1,950.000 6,950,000 4,000,000 The depreciation expense for 2022 and 2023 was P500,000 and P550,000, respectively. What amount was debited to accumulated depreciation during 2023 because of property, plant and equipment retirement?

Answer rating: 100% (QA)

1 Kent Company The machines cost includes the purchase price and all costs necessary to get the machine ready for use which includes shipping and installation costs Thus the total cost of the machine ... View the full answer