REVIEW 2 SET L PROBLEM 1 FEDERIZO Co. started operations on October 1, 2015. Its accounts at June 30, 2018 included the following balances: Machinery (at cost) P 196,000 Accumulated depreciation - machinery 95,772 Vehicles (at cost purchased February 20, 2016) 320,000 Accumulated depreciation - vehicles 178,880 Land (at cost; purchased March 20, 2018) 150,000 000 Buildings (at cost; purchased March 20, 2018) 581,200 Accumulated depreciation - building 6,840 Land improvements (at cost purchased March 20, 2018) 36,000 Accumulated depreciation - land improvements 600 Details of machines owned at June 30, 2018 were: Machine Purchase Date Cost Useful Life Residual Value October 2, 2015 P 50,000 4 years P 5,000 WNP December 27, 2015 84,000 5 years 8, 000 July 29, 2016 52,000 4 years 6, 000 Additional Information: a. FEDERIZO calculates depreciation to the nearest month and balances the records at month-end. Recorded amounts are rounded to the nearest peso, and the reporting date June 30. b. FEDERIZO uses straight-line depreciation for all depreciable assets except vehicles, which are depreciated on the diminishing balance at 30% p.a c. The vehicles account balance reflects the total paid for four identical delivery vehicles, which cost P80,000 each. d. On acquiring the land and building, FEDERIZO estimated the building's useful life and residual value at 20 years and P34,000 respectively e. The land improvements account balance reflects a payment of P36,000 made on March 20, 2017 for driveways and a car park. On acquiring these land improvements, Tanya estimated their useful life at 15 years with no residual value. The following transactions occurred from July 1, 2018: Aug. 03, 2018 Purchased a new machine (machine 4) for a cash price of P72,000. Installation costs of P3,600 was also paid. Tanya estimated the useful life and residual value at five years and P7,000 respectively. Nov. 15, 2018 Paid vehicle repairs of P1,200 Dec. 30, 2018 Exchanged one of the vehicles for items of fixtures that had a fair value of P34,000 at the date of exchange. The fair value of the vehicle at the date of exchange was P 32,000. The fixtures originally cost P100,000 and had been depreciated by P62,000 to the date of exchange in the previous owner's books. Tanya estimated the fixtures' useful life and residual value at five years and P5,000 respectively. Mar. 10, 2019 Sold machine 1 for P10,000 cash. June 30, 2019 Recorded depreciation expense. Sept. 20, 2019 Traded in machine 3 for a new machine (machine 5). A trade-in allowance of P20,000 was received for machine 3 and P68,000 was paid in cash. Tanya estimated machine 5's useful life and residual value at six years and P10,000 respectively Dec. 30, 2019 Scrapped machine 2, as it was surplus to requirements and no buyer could be found it. Feb. 08, 2020 Paid P16,000 to overhaul machine 4, after which machine 4's useful life was estimated at two remaining years and its residual value was revised to P10,000.Based on the preceding information, determine the following: 1. Depreciation expense on machinery for the year ended June 30, 2019? 2. Gain on exchange on December 30, 2018. 3. Total depreciation expense on all depreciation assets for the year ended June 30, 2019 4. Gain on trade in of machine no. 3 on September 20, 2019. 5. Total depreciation expense on all depreciable assets for the year ended June 30, 2020. PROBLEM 2 You have been asked by the proprietor of the GIGANTE CO. to verify the accountability of the cashier- bookkeeper, who was allowed to take a vacation leave a few days ago. A. The bank reconciliation statements prepared by the cashier-bookkeeper are presented below