Velasquez Company sold an item of equipment costing P3,800,000 to Vince for P5,000,000. 20% downpayment was paid upon signing of the agreement while the balance was payable in four equal annual installment. Vince defaulted on the second installment prompting Velasquez to repossess the sale. The repossessed equipment was appraised at P2,250,000 after P100,000 reconditioning cost. How much is the repossession gain or (loss) assuming the installment sale was recorded was initially recorded under accrual method? (130,000) (850,000) 350,000 (750,000)

Velasquez Company sold an item of equipment costing P3,800,000 to Vince for P5,000,000. 20% downpayment was paid upon signing of the agreement while the balance was payable in four equal annual installment. Vince defaulted on the second installment prompting Velasquez to repossess the sale. The repossessed equipment was appraised at P2,250,000 after P100,000 reconditioning cost. How much is the repossession gain or (loss) assuming the installment sale was recorded was initially recorded under accrual method? (130,000) (850,000) 350,000 (750,000)

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter11: Long-term Assets

Section: Chapter Questions

Problem 5EB: Steele Corp. purchases equipment for $30,000. Regarding the purchase, Steele paid shipping of...

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