An asset was bought for Php 15,500,000 8 years ago, with an expected lifetime fo 12 years. If Declining balance method is applied, what is the book value of the asset if it has a salvage value equivalent to 5% of its initial investment cost? OP 1,997,581.32 OP 1.339,632.65

An asset was bought for Php 15,500,000 8 years ago, with an expected lifetime fo 12 years. If Declining balance method is applied, what is the book value of the asset if it has a salvage value equivalent to 5% of its initial investment cost? OP 1,997,581.32 OP 1.339,632.65

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Lauderdale Corporation is organized in three geographical divisions (regions) with managers…

A: Divisional income is required to evaluate the performance of a divisional manager. The divisional…

Q: At year-end the perpetual inventory records of Garbo Company showed merchandise inventory of…

A: INVENTORY VALUATIONInventory Valuation is a Method of Calculation of Value of Inventory at the End…

Q: Rey Company's single product sells at a price of $220 per unit. Data for its single product for its…

A: The income statement is on of the important financial statements of the business. The income…

Q: Assume a merchandising company provides the following information from its master budget for the…

A: CASH BUDGET Cash Budget is a detailed budget of cash income and cash expenditure incorporating both…

Q: Rubble, Inc. produced 1,180 backpacks, the company's product in 2020. The standard cost was 4 yards…

A: Direct material cost variance is calculated by multiplying actual quantity by the difference between…

Q: chel Corporation purchased a building by paying $91,500 cash on the purchase date, agreeing to pay…

A: Discounting future cash flows or payments to their current value in today's dollars is the process…

Q: Exercise 19-18 (Static) Analyzing a special offer for a service company LO P3 Empire Airlines…

A: Income statement is a financial statement that shows profitability, total revenue and total…

Q: PE 12-11 Comparative Common-Size Income Statement Using the following data, (1) prepare comparative…

A: Comparative financial statements are used to compare two or more years to understand the financial…

Q: The Street Division of Labrosse Logistics just started operations. It purchased depreciable assets…

A: Operating assets are the assets of the entity which are engaged in the operating activities of the…

Q: Buring 2020, Organic Foods Inc. made sales of $4.000 (assume all on account) and collected cash of…

A: A company's income statement offers insightful information about its financial performance,…

Q: Presented below is information related to Novak Manufacturing Corporation. Asset A B C D E Cost…

A: Depreciation is the process of reducing the value of the assets. It is a non-cash expense of the…

Q: The following incomplete (columns have missing amounts) pension spreadsheet is for the current year…

A: Pension expense is the obligation of the company or cost of the company for the pension benefits…

Q: Long-term debt Notes payable, 14% 8% convertible bonds payable 10% convertible bonds payable Total…

A: Earings per share presents the net income of the company allocated to each share. Earnings per share…

Q: Crane Corporation, an amusement park, is considering a capital investment in a new exhibit. The…

A: Introduction:Net present value (NPV) is the difference between the current value of cash and the…

Q: Regular Company produces audio equipment, specifically headphones and speakers. A new CEO has just…

A: Manufacturing overhead is the indirect costs that are incurred during the manufacturing process,…

Q: 2-a. Compute both the new average unit cost and the incremental unit cost for the special order.…

A: Variable costs are costs that varies with the change in the level of output whereas fixed costs are…

Q: ny paid $1.15 per yard. Standard time to make the backpacks was 2 direct labor hours per unit at a…

A: A financial metric known as the "direct labor cost variance" is used in cost accounting and…

Q: Vulcan Flyovers offers scenic overflights of Mount Saint Helens. Data concerning the company's…

A: The flexible budget is prepared on the basis of standard rates for the Actual level of production. A…

Q: Please answer complete question please answer within the format by providing formula the…

A: Costs incurred by the service departments need to be allocated to operating departments. This is…

Q: On July 8, Azure Corporation enters into an agreement with one of its customers, Madsen, Inc. to…

A: Under the accrual method, revenues and expenses are recorded when they are earned or incurred,…

Q: The Heating Division of Sheffield International produces a heating element that it sells to its…

A: The price charged for the goods and services transferred between the divisions is referred to as…

Q: Calculate depreciation. A machine cost $165,000 on April 28, 2021. Its estimated salvage value is…

A: There are two types of depreciation methods i.e., the accelerated method and the straight-line…

Q: Dake Corporation's relevant range of activity is 5,200 units to 6,000 units. When it produces and…

A: DIRECT MANUFACTURING COST Direct Manufacturing Cost Includes Cost of Direct Material & Cost of…

Q: n Pharoah Inc. owns these assets at the statement of financial position date: Cash in bank (savings…

A: Post dated check are not considered as cash and cash equivalentsIncome tax refund is not considered…

Q: On January 1, 2024, White Water issues $540,000 of 7% bonds, due in 10 years, with interest payable…

A: Bond is a debt security which includes a regular fixed coupon payment at the end of a specified…

Q: For its three investment centers, Concord Company accumulates the following data: Sales Controllable…

A: Ratio analysis is a method used to analyze financial statements by calculating and comparing various…

Q: Gary's business is booming! Plans are in place to expand the existing facility. But in the meantime,…

A: Overhead distribution worksheet shows the apportionment of indirect cost to different departments…

Q: + 5 5 7 B 8 9 Activity 10 Production Setup 11 Procurement 12 Quality Control 13 Materials Management…

A: Activity-based costing is used to allocate overhead expenses on the basis of activity. Other than…

Q: Zolnick Enterprises has two hourly employees-Kelly and Jon. Both employees earn overtime at the rate…

A: Gross pay refers to the total amount of money an employee earns before any deductions, such as…

Q: Seth Fitch owns a small retall ice cream parlor. He is considering expanding the business and has…

A: The payback period illustrates the length of time it takes a company to recover its investment. When…

Q: Vaughn Company has accumulated the following budget data for the year 2025. Sales: 31,320 units,…

A: Income statement is a financial statement that records all the income and expenses of the business…

Q: As a start-up / ‘new’ manufacturer, one of your tasks as the Operations Manager is to identify the…

A: The objective of the question is to identify and compare the three known methods of measuring cost…

Q: the firm bought equipment costing $57,600. The equipment has an expected useful life of 10 years and…

A: Adjusting entries are used to record unrecorded transactions for accrued revenues and expenses,…

Q: chriever Corporation is an oil well service company that measures its output by the number of wells…

A: The main purpose of Standard costing is to compare your actual performance with these standards and…

Q: The following adjusted trial balance at December 31 of Wilson Trucking Company. Account Title Debit…

A: Balance sheet is a financial statement that shows list of final ending balances of assets,…

Q: On December 31, 2023, Berclair Incorporated had 220 million shares of common stock and 4 million…

A: Earnings per share:EPS is the ratio between the net profit and outstanding shares of the company. It…

Q: Required information Use the following information for the Problems below: The following data…

A: Ratio analysis s helps to analyze the financial statements of the company. Management can make…

Q: Sheffield Co. uses a periodic inventory system. Its records show the following for the month of May,…

A: LIFO (Last-In, First-Out) and FIFO (First-In, First-Out) are two different methods used to account…

Q: Required information [The following information applies to the questions displayed below.] Annin…

A: The equivalent units are calculated on the basis of the percentage of the work completed during the…

Q: Exercise 10-38 & 10-39 (Algo) (LO 10-3, 4) [The following information applies to the questions…

A: The indifference point refers to a situation where the outcome of both alternatives is the same. In…

Q: Grouper Corp, has 7,700 shares of common stock outstanding. It declares a $5 per share cash dividend…

A: Journal entries are the primary reporting of the business transactions in the books of accounts.…

Q: Maggie Sound manufactures headphone cases. During July 2021, the company produced 107,000 cases and…

A: Variance arises when the actual costs differ from the standard costs. The results are favorable…

Q: Shadee Corporation expects to sell 540 sun shades in May and 370 in June. Each shades sells for $11.…

A: Cash collection budget :— This budget is prepared to estimate the collection of sales from customers…

Q: Required information [The following information applies to the questions displayed below.] Wyalusing…

A: Return on investment (ROI) is one of the profitability ratio being used in business for determining…

Q: On December 31, 2024, Sunland Company leased machinery from Carla Vista Corporation for an…

A: Lease is defined a contractual agreement incorporated between two business entities where one entity…

Q: Selected information from the annual financial statements of Delicata Industries is shown below…

A: The different financial ratios used for the analysis of the company performance are divided as:(a)…

Q: Product Pricing using the Cost-Plus Approach Methods; Differential Analysis for Accepting Additional…

A: "Since you have asked a question with sub-parts more than three, as per guidelines, the first three…

Q: Prepare an unadjusted trial balance as of 30 November 2022.

A: Unadjusted trial balance is summary of all general ledger account balances in the business. This is…

Q: Required information [The following information applies to the questions displayed below.] The…

A: FIFO Method: Which is a method used to calculate the cost of goods sold and the cost of ending…

Q: A cash budget, by quarters, is given below for a retail company (000 omitted). The company requires…

A: Calculation of missing amount in 1st quarterCollections from customers = Total cash available - Cash…

Question

An asset was bought for Php 15,500,000 8 years ago, with an expected
lifetime fo 12 years. If Declining balance method is applied, what is the
book value of the asset if it has a salvage value equivalent to 5% of its initial
investment cost?
OP 1,997,581.32
OP 1.339,632.65
OP 2,103,673.65
P 2,209,221.91

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1: Introduction

VIEW

Step 2: Calculating the required part.

VIEW

Solution

VIEW

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

An equipment cost P60,000 today and its salvage value is P20,000 after 6 years. Calculate its depreciation at year 2 with 3.45% interest rate.Use Sinking Fund Method
The following table summarizes the financial data for a proposed new asset. The issue is how long the asset should be kept. Assume an interest rate of 12% and delermine the economic service life of the anset. End of YearN) Investment cost O&M Cost Salvage value $14,000 $3.400 $8.000 $4600 $6.000 $5.800 $4,000 01 year O2 years 3 years O Not enough information
Description You are to create a year-by-year depreciation schedule for an asset that has a cost basis (B) of $950,000 and estimated salvage value (SV 10) of $80,000 after 10 years. For the straight-line and declining balance methods, use a depreciable life (N) of 10 years. For MACRS, use a recovery period (N) of 7-yrs. ΕΟΥ, Κ 0 1 2 3 st 4 5 6 7 8 'a 9 10 Straight-Line BVk $950,000 Declining Balance dk BVk $950,000 dk MACRS BVk 950,000
A depreciable asset has a cost of P120,000, estimated useful life of 8 years, and an estimated residual value of P20,000.1. What is the depreciation rate if you are using the straight line method?2. What is the depreciation rate if you are using 150% declining balance method?3. What is the depreciation rate if you are using double declining balance method?Note: For nos. 1 to 3, the rate must be rounded off to two decimal places. Ex: 10.00%, 12.30%, 15.55%4. What is the depreciation rate if you are using the declining balance method?Note: For no. 4, the rate must be rounded off to 6 decimal places. Ex: 10.123456%5. Using SYD method, what is the depreciation expense for the 1st year?6. Using SYD method, what is the carrying amount at the end of the 6th year?7. Using double declining balance method, what is the carrying amount at the end of the 3rd year? Subparts 4-5 only
Equipment will be purchased at a cost of P250,000. It will have no salvage value. The cash flows are expected to be: P37,000, P48,000, P65,000, P71,000, P73,000, and P53,000 over the life of the equipment. What is the payback period? Group of answer choices 3.43 years 6.00 years 5.25 years 4.40 years
A certain equipment has a first cost of P 12,000 and a salvage value of P 500 at the end of x years. What is the value of x if the annual depreciation is P 1,567.6 using the Sinking Fund Method at 8%?
Given the following data of equipment A and B. A First Cost P 50 000 P 150 000 2000 Salvage Value Annual Maintenance 6000 Economic life 6000 3000 5 15 The MARR is 12%. Use sinking fund depreciation. What is the rate of return for the additional initial investment on equipment B?
Using the following data, solve for the depreciation and book value and prepare tabulation of book value using a) Straight Line Method, b) Sinking Fund Method, c) Declining Balance Method, and d) Sum-of-Years Digit (SOYD) Method. First cost = ₱10,000 Salvage Value = ₱500 Life of Property = 5 years m = 3 years For sinking fund method, assume 10% interest rate.
A Machine costs ₱80,000 and an estimated life of 10 years with a salvage value of ₱5,000. What is the book value after 5 years using the following methodology? a. Straight Line Method. BV5=₱42,500 b. Sinking Fund Method if i=9%. BV5=₱50,456.44 c. Declining Balance Method if the depreciation cost is equal to the value of i. BV5=₱49,922.57 d. Double Declining Balance Method. BV5=₱26,214.40 e. Sum of the Years Digit Method. BV5=₱25,454.5 f. Service-Output Method. Assuming that the total service of the machine is 1,497,600 hours and the number of working days per year is 260 days. What is the book value after 4 years if the machine production time a is 24 hours? BV4=₱79,687.38
Using the following data, solve for the depreciation and book value and prepare tabulation of book value using Sum-of-Years Digit (SOYD) Method. First cost = ₱10,000 Salvage Value = ₱500 Life of Property = 5 years m = 3 years For sinking fund method, assume 10% interest rate.
A bulldozer has an initial cost of Php 2,000,000. Its salvage value after 12 years is Php 175,000. As a percentage of the initial cost, what is the straight- line depreciation rate of the equipment? O 7.6041% O 6.6041% O 8.6041% O 5.6041%
An equipment costing Php 750,000 has a life expectancy of 6 years. Using the sum-of-the–year’s digit method of depreciation, what must be its salvage value such that its depreciation charge at the fourth year is Php 50,000? Solve show solution.