At the beginning of the year 2019, Trunk Company has an investment property acquired at a cost of P1,700,000 that is to be accounted under the cost model. Depreciation of 10% is recognized annually and periodic continuing repair costs of P3,500 per year as well as property tax of P2,700 are incurred by the company on an annual basis. What should be the carrying value of the investment at the end of the year 2019?
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- On January 1, 2020, ERNSTCo. finished constructing an edifice that will be accounted for as an investment property using the cost model.Total construction cost was P35,000,000. The entity estimates that the asset will be useful for 40 years. Continuing repairs on the building amount to P60,000 every year, and annual real property tax to be paid by the company is P110,000. Determine the following: 1.Annual expenses incurred by ERNSTin relation to its investment property. 2.Carrying amountof the asset at the end of 2022.At the beginning of the year 2019, Trunk Company has an investment property acquired at a cost of P1,700,000 that is to be accounted under the cost model. Depreciation of 10% is recognized annually and periodic continuing repair costs of P3,500 per year as well as property tax of P2,700 are incurred by the company on an annual basis. What should be the carrying value of the investment at the end of the year 2019? On April 1, 2019, Red Company purchased as a trading security a P1,000,000 face value 8% bond for P920,000 plus brokerage of P12,000 and accrued interest. The bonds mature on January 1, 2023 and pay interest annually on January 1. On December 31, 2019, the bonds had a market value of P965,000. For the year ending December 31, 2019 income statement, what amount should Red report as Unrealized gain or loss from trading securities? (Do not include any parenthesis, just amount without period or comma) Dahlia Company purchased a P2,000,000 12% face value bonds, 10…On January 1, 2019, the Business Info Company had capitalized costs of P6,000,000 for a new computer software product with an estimated useful life of 4 years. Sales for the software product during were P2,400,000 in 2019 and P4,200,000 in 2020. The total sales of the software over the economic life are expected to be P12,000,000. Question: What amount of amortization of computer software should Business Info Company record for the year 2020? а. РО P1,500,000 P1,800,000 P2,100,000 b. C. d.
- On January 1, 2020, Bing Company acquired equipment on credit. The terms were $8,000 cash down payment plus payments of $6,000 on January 1 for each of the next four years. The implicit interest rate was 6%. The equipment’s list price was $30,000. Additional costs of $2,000 were incurred to install the equipment. Determine the value at which Ling should report the acquired asset. Show your calculations. For any measurement involving present value concepts, provide your calculations.Alta Company is constructing a production complex that qualifies for interest capitalization. The following information is available: Capitalization period: January 1, 2019, to June 30, 2020 Expenditures on project: 2019: January 1 $ 456,000 May 1 489,000 October 1 588,000 2020: March 1 1,572,000 June 30 552,000 Amounts borrowed and outstanding: $1.7 million borrowed at 10%, specifically for the project $6 million borrowed on July 1, 2018, at 12% $10 million borrowed on January 1, 2017, at 6% Required: Note: Round all final numeric answers to two decimal places. Compute the amount of interest costs capitalized each year. Capitalized interest, 2019 $ fill in the blank 1 Capitalized interest, 2020 $ fill in the blank 2 If it is assumed that the production complex has an estimated life of 20 years and a residual value of $0, compute the straight-line depreciation in 2020. $ fill in the blank 3asap Benson Limited is constructing a Power Plant which was completed on 31st December 2019. The company obtained a bank loan of R1,000,000 at a rate of 15% per annum to construct the Power Plant on 1st January 2019. As of 31st December 2019, Benson Limited also had the following loans outstanding: I. 18% 5-year loan Note of R1,500,000 II. 14% Debentures of R1,000,000 Expenditures on the project were made as follows: I. On the 31st March 2019, R600,000 was incurred; II. R800,000 was incurred on 30th June 2019; III. The final expenditure incurred was R300,000 on 31st December 2019. During the year Benson Limited invested R400,000 of the bank loan for 2 months at an interest of 9% per annum. Required: Determine the amount of borrowing costs to be capitalized and expensed.
- Alta Company is constructing a production complex that qualifies for interest capitalization. The following information is available: Capitalization period: January 1, 2019, to June 30, 2020 Expenditures on project: 2019: January 1 $ 456,000 May 1 417,000 October 1 648,000 2020: March 1 1,512,000 June 30 708,000 Amounts borrowed and outstanding: $1.7 million borrowed at 10%, specifically for the project $7 million borrowed on July 1, 2018, at 12% $14 million borrowed on January 1, 2017, at 6% Required: Note: Round all final numeric answers to two decimal places. Compute the amount of interest costs capitalized each year. Capitalized interest, 2019 $___________________ Capitalized interest, 2020 $___________________ If it is assumed that the production complex has an estimated life of 20 years and a residual value of $0, compute the straight-line depreciation in 2020. $________________Alta Company is constructing a production complex that qualifies for interest capitalization. The following information is available: Capitalization period: January 1, 2019, to June 30, 2020 Expenditures on project: 2019: January 1 $ 504,000 May 1 405,000 October 1 504,000 2020: March 1 1,392,000 June 30 540,000 Amounts borrowed and outstanding: $1.6 million borrowed at 10%, specifically for the project $6 million borrowed on July 1, 2018, at 12% $13 million borrowed on January 1, 2017, at 6% Instructions: Note: Round all final numeric answers to two decimal places. Compute the amount of interest costs capitalized each year. Capitalized interest, 2019 $ fill in the blank 1 Capitalized interest, 2020 $ fill in the blank 2 If it is assumed that the production complex has an estimated life of 20 years and a residual value of $0, compute the straight-line depreciation in 2020. $ fill in the blank 3Alta Company is constructing a production complex that qualifies for interest capitalization. The following information is available: • Capitalization period: January 1, 2019, to June 30, 2020 • Expenditures on project: 2019: 2020: January 1 May 1 October 1 $ 540,000 537,000 600,000 March 1 June 30 Amounts borrowed and outstanding: $1.7 million borrowed at 10%, specifically for the project $7 million borrowed on July 1, 2018, at 12% $16 million borrowed on January 1, 2017, at 6% Required: 1,404,000 504,000 Note: Round all final numeric answers to two decimal places. 1. Compute the amount of interest costs capitalized each year. Capitalized interest, 2019 $ Capitalized interest, 2020 2. If it is assumed that the production complex has an estimated life of 25 years and a residual value of $0, compute the straight-line depreciation in 2020. $ 3. Since GAAP requires accrual accounting, if a company capitalizes interest during the construction period it will report will report income than…
- Bebe Co. purchased equipment costing P560,000 on March 5, 2021. How much would be the claimable input VAT on the second quarter of 2021?10. During 2021, Entity K purchased a franchise for P960,000. In addition, 5% of the revenue from the franchise must be paid to the franchisor. Revenue from the franchise for 2021 was P5,000,000. Entity K estimates the useful life of the franchise to be 10 years and takes full year's amortization in the year of purchase. The total franchise-related expenses is *Benson Limited is constructing a Power Plant which was completed on 31st December 2019. The company obtained a bank loan of R1,000,000 at a rate of 15% per annum to construct the Power Plant on 1st January 2019. As of 31st December 2019, Benson Limited also had the following loans outstanding: 18% 5-year loan Note of R1,500,000 14% Debentures of R1,000,000 Expenditures on the project were made as follows: On the 31st March 2019, R600,000 was incurred; R800,000 was incurred on 30th June 2019; The final expenditure incurred was R300,000 on 31st December 2019. During the year Benson Limited invested R400,000 of the bank loan for 2 months at an interest of 9% per annum. Required: Determine the amount of borrowing costs to be capitalized and expensed. I. II. I. II. III.