PACIFIC SOUTHBAY COLLEGE, INC.
Purok Carmenville, Calumpang, General Santos City
Acctg 24
Name: Louie Jay J. Bialan_BSA 2
MODULE 3 DEPRECIATION
Problem 30-1 (IAA)
Amicable Company
Answer:
a. Depreciation Table- Straight line
Year
Particulars
Depreciation
Accumulated
Depreciation
Carrying
Amount
P 120,000
240,000
360,000
480,000
600,000
P 635,000
515,000
395,000
275,000
155,000
35,000
Accumulated
Depreciation
Carrying
Amount
P 140,000
270,000
370,000
480,000
600,000
P 635,000
495,000
365,000
265,000
155,000
35,000
Acquisition cost
2019
2020
2021
2022
2023
P 120,000
120,000
120,000
120,000
120,000
P 600,000
b. Depreciation Table- Service Hours Method
Year
Particulars
2019
2020
2021
2022
2023
Acquisition cost
P 14,000x10
13,000x10
10,000x10
11,000x10
12,000x10
Depreciation
P 140,000
130,000
100,000
110,000
120,000
P 600,000
Depreciation rate per hour = P 600,000/60,000= 10
c. Depreciation Table- Production Method
Year
Particulars
Depreciation
2019
2020
2021
2022
2023
Acquisition cost
P 34,000x4
32,000x4
25,000x4
29,000x4
30,000x4
P 136,000
128,000
100,000
116,000
120,000
P 600,000
Accumulated
Depreciation
Carrying
Amount
P 136,000
264,000
364,000
480,000
600,000
P 635,000
499,000
371,000
271,000
155,000
35,000
Depreciation rate unit of output = P 600,000/150,000= 4
Problem 30-2 (IAA)
Austere Company
Answer:
a. Straight line method:
2019
2020
P 27,500
55,000
b. Working hours method:
Rate per hour = P 550,000/50,000 hours= 11
2019
2020
(P 3,000 hoursx11)
( 5,000 hoursx11)
P 33,000
55,000
c. Output Method:
Rate per unit = P 550,000/200,000 hours= 2.75
2019
2020
(P 18,000 unitsx2.75)
( 22,000 unitsx2.75)
P 49,500
60,500
Problem 30-3 (IAA)
Definite Company
Answer:
Asset
Cost
Machinery
P 310,000
Office equipment
110,000
Building
1,600,000
Delivery equipment 430,000
P2,450,000
Salvage
Depreciation
cost
Life in
years
P 10,000
10,000
100,000
30,000
P 300,000
100,000
1,500,000
400,000
P2,300,000
5
10
15
4
Annual
Dep’n
P 60,000
10,000
100,000
100,000
P 270,000
a. Composite rate= P 270,000/2,450,000= 11.02%
b. Composite life= P2,300,000/270,000= 8.52 years
c. Depreciation
Accumulated Depreciation
P 270,000
P 270,000
Problem 30-4 (ACP)
Happy Company
Answer:
Asset
Building
Machinery
Equipment
Cost
P 6,100,000
2,550,000
1,030,000
P9,680,000
Salvage
Depreciation
cost
Life in
years
100,000
50,000
30,000
P 6,000,000
2,500,000
1,000,000
P9,500,000
20
5
10
Annual
Dep’n
P 300,000
500,000
100,000
P900,000
a. Composite rate= P 900,000/9,680,000= 9.3%
b. Composite life= P9,500,000/900,000= 10.56 years
c. Depreciation
Accumulated Depreciation
P 900,000
d. Cash
Accumulated Depreciation
Machinery
P
P 900,000
40,000
2,510,000
P 2,550,000
e. Depreciation
Accumulated Depreciation
(P 9,680,000-2,550,000x9.3%)
P 663,090
P 663,090
Problem 31-1 (ACP)
Bitter Company
Answer:
Sum of years digit
1. A
April 1,2019- March 31, 2020 (P 1,080,000x8/36)
April 1,2020- March 31, 2021 ( 1,080,000x7/36)
P 240,000
210,000
Depreciation from April 1 to December 31, 2019 (P 240,000x9/12) P 180,000
2. B
Depreciation for 2020:
January 1- March 31 (P 240,000x3/12)
April 1- December 31 ( 210,000x9/12)
P
60,000
157,500
P 217,500
Double declining balance
3. C
4. C
Fixed rate=100/8=12.5x2=25%
2019 (P 1,200,000x25%x9/12)
2020 ( 1,200,000- 225,000x25%)
P 225,000
243,750