Mazaya Company has decided to sell one of its old machines on June 30, 2011. The machine was purchased for R.O:120,000on January1, 2007, and was depreciated on a straight-line basis for 10 years with no residual value If the machine was soldfor R.O 33,000, what was the amount of the gain or loss recorded at the time of the sale?Select one.a R.O 69,000.b. RO.27,000.O CRO33,000d. RO 81,000.

Gains: Gains are the profits earned from non-operating activities of a business like sale of land,…

Answered: Mazaya Company has decided to sell one…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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XL Co. owns a machine purchased a machine 4 years ago for OMR 80,000. The accumulated depreciation on the machine to date is OMR 32,000. Depreciation rate is 10% per annum straight line method. XL Co. can sell the machine to another manufacturer for OMR 50,000. In order to make the sale, XL Co. must incur a transportation cost of OMR 2000. If XL Co. replaces the machine with a new version, it would cost OMR120,000. The cash flows from existing machine are estimated to be OMR 25,000 for the first two years and OMR 20,000 for the remaining 4 years of the machine’s life. The discount rate at 10 % is: - Year -1 0.909, Year -2 0.826, Years- 3 to 6 inclusive 2.619 (annuity rate) Calculate the value of machine under the four methods identified in the four possible measurement bases with clear steps and calculations .
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This question is based on the following information: Trinity Company bought a copying machine costing P 123,000 with an estimated life of 3 years with negligible salvage value. The estimated earnings after taxes of this machine at the end of each year are estimated below: Earnings after taxes End of year 1 P 8,120 2 7,200 3 6,820 The company is using the straight line method for computing the depreciation. What is the accounting rate of return on the average cost of investment? a. 10.5% b. 11.5% c. 12% d. 15%
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Mazaya Company has decided to sell one of its old machines on June 30, 2011. The machinewas purchased for R.O:120,000 on January 1, 20o07, and was depreciated on a straight-line basis for 1o years with no residual value. f the machine was sold for R.O 33.000, what was the amount of the gain or loss recorded at the time of the sale? Select one O a RO 69,00. b. RO 27.000. O CRO33,00. O d RO 81,00.
Mario Ltd purchased a machine for GHS 50,000 on 1 January 20X1. The machine was judged to have a five-year life with a residual value of GHS 5,000. During 20X3, the market for the product declined and the machine was sold on 1 January 20X4 for GHS 7,000. According to IAS 16 Property, Plant and Equipment, what was the loss on disposal? A. GHS 27,000 B. GHS 13,000 C. GHS 16,000 D. GHS 23,000
(Depreciation Computation—Replacement, Nonmonetary Exchange) George Zidek Corporation bought a machine on June 1, 2015, for $31,000, f.o.b. the place of manufacture. Freight to the point where it was set up was $200, and $500 was expended to install it. The machine’s useful life was estimated at 10 years, with a salvage value of $2,500. On June 1, 2016,an essential part of the machine is replaced, at a cost of $1,980, with one designed to reduce the cost of operating the machine. The cost of the old part and related depreciation cannot be determined with any accuracy.On June 1, 2019, the company buys a new machine of greater capacity for $35,000, delivered, trading in the old machine which has a fair value and trade-in allowance of $20,000. To prepare the old machine for removal from the plant cost $75, and expenditures to install the new one were $1,500. It is estimated that the new machine has a useful life of 10 years, with a salvage value of $4,000 at the end of that time. (The…

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