Problem 4On February 5, 2020, Diamond Company purchased a new machine on a deferred payment basis. A downpayment of P100,000 and four P250,000 yearly installments will be made every February 1, starting nextFebruary 1, 2021. The imputed discount rate is 6.833%. How much is the initial cost of the asset? Problem 6On January 2020, Mina Company paid the national government a fee in the amount of P129,000,000 for anarea of interest with removable ore estimated by geological surveys at 10,000,000 tons. Mina is required bythe national government to restore the area of interest after the extraction of the estimated units ofreserves, Mina Company estimates that it will take 10 years to fully extract the reserves and estimates itsrestoration cost to be P10,000,000. The relevant discount rate is 10% (use 3 decimal places to round offthe present value factor). The company expects to recover P2,000,000 on the disposal of the asset at theend of its useful life.The Company also incurred P2,150.000 of development costs in preparing the property for the extractionof the ore. During 2020, 540,000 tons were mined.How much is the carrying value of the wasting asset as of December 31, 2020?

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Problem 4 On February 5, 2020, Diamond Company purchased a new machine on a deferred payment basis. A down payment of P100,000 and four P250,000 yearly installments will be made every February 1, starting next February 1, 2021. The imputed discount rate is 6.833%. How much is the initial cost of the asset?

Problem 4 On February 5, 2020, Diamond Company purchased a new machine on a deferred payment basis. A down payment of P100,000 and four P250,000 yearly installments will be made every February 1, starting next February 1, 2021. The imputed discount rate is 6.833%. How much is the initial cost of the asset?

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

Chapter10: Property, Plant And Equipment: Acquisition And Subsequent Investments

Section: Chapter Questions

Problem 3MC: Electro Corporation bought a new machine and agreed to pay for it in equal annual installments of...

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Acruni Co. had the following loans in place at the beginning of 2019. 1 January 2019 GHC m 10% Bank loan repayable 2020 9.5% Bank loan repayable 2021 8.9% debenture repayable 2024 120 80 100 On 1 January 2019, Acruni Co began construction of a qualifying asset, a piece of machinery for a hydroelectric plant, using existing borrowings. Expenditure drawn down for the construction was GHC30 million on 1 January 2019, and GHC20 million on 1 October 2019. Surplus funds were invested temporarily at a rate of 2%. Required a) Calculate the borrowing costs that can be capitalized for the piece of machinery. b) Compute the cost of the machinery that will be reported in the statement of financial position as at December, 2019 ATES)
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9. A granite company is planning to buy a fully automated granite cutting machine. If it is purchased under down payment, the cost of the machine is ETB 16,00,000. If it is purchased under installment basis, the company has to pay 25% of the cost at the time of purchase and the remaining amount in 10 annual equal installments of ETB 2,00,000 each. Suggest the best alternative for the company using the present worth basis at i = 18%, compounded annually.
View Policies Current Attempt in Progress A machine is purchased by making payments of $ 20500 at the beginning of each of the next five years. The interest rate was 8%. The Future value of an ordinary annuity of 1 for five periods is 5.86660. The present value of an ordinary annuity of 1 for five periods is 3.99271. What was the cost of the machine? O $ 120265 O $81852 O $ 129887 O $ 88399 Save for Later Attempts: 0 of 1 used Submit Answer
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