In the beginning of 2021, Ciento Company purchased equipment worth P250,000. It is estimated to be useful for 5 years and has a residual value of P25,000. 1. If this equipment will be depreciated over the course of its useful life by the double declining balance method, what amount of depreciation should be recorded for 2023? a. P32,400 b. P21,600 c. P12,960 d. P7,400 2. What is the 5th year depreciation if the 150% declining balance method is used? a. P32,400 b. P35,025 c. P18,007.5 d. P18,975

In the beginning of 2021, Ciento Company purchased equipment worth P250,000. It is estimated to be useful for 5 years and has a residual value of P25,000. 1. If this equipment will be depreciated over the course of its useful life by the double declining balance method, what amount of depreciation should be recorded for 2023? a. P32,400 b. P21,600 c. P12,960 d. P7,400 2. What is the 5th year depreciation if the 150% declining balance method is used? a. P32,400 b. P35,025 c. P18,007.5 d. P18,975

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Description: In the beginning of 2021, Ciento Company purchased equipment worthP250,000. It is estimated to be useful for 5 years and has a residual valueof P25,000.1. If this equipment will be depreciated over the course of its usefullife by the double declinin

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter11: Depreciation, Depletion, Impairment, And Disposal

Section: Chapter Questions

Problem 8MC: On July 1, 2018, Mundo Corporation purchased factory equipment for 50,000. Residual value was...

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On May 10, 2019, Horan Company purchased equipment for 25,000. The equipment has an estimated service life of 5 years and zero residual value. Assume that the straight-line depreciation method is used. Required: Compute the depreciation expense for 2019 for each of the following four alternatives: 1. Horan computes depreciation expense to the nearest day. (Use 12 months of 30 days each and round the daily depreciation rate to 2 decimal places.) 2. Horan computes depreciation expense to the nearest month. Assets purchased in the first half of the month are considered owned for the whole month. 3. Horan computes depreciation expense to the nearest whole year. Assets purchased in the first half of the year are considered owned for the whole year. 4. Horan records one-half years depreciation expense on all assets purchased during the year.
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