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Sunday, November 14, 2010

Valix Finacc vol 1 Problem 16-23

Financial Accounting Volume 1 2008 Valix-Peralta
Chapter 16 Problem 16-23



1. Depreciation (60,000 x 3/12)                                                     15,000
            Accumulated depreciation                                                                           15,000
                                                                                                                                               
    Accumulated depreciation (480,000 + 15,000)                       495,000
    Loss on retirement of store equipment                                  105,000
            Store equipment                                                                                          600,000
                                                                                                                                               
2. Depreciation (150,000 x 4/12)                                                  50,000
            Accumulated depreciation                                                                          50,000

    Cash                                                                                      100,000
    Accumulated depreciation (1,050,000 + 50,000)                 1,100,000
    Loss on sale of office equipment                                           300,000
            Office equipment                                                                                      1,500,000

3. Depreciation (600,000 x 5/12)                                                 250,000
Accumulated depreciation                                                                         250,000

    Delivery equipment – new                                                  5,000,000
    Accumulated depreciation                                                2,650,000
            Cash (5,000,000 – 750,000)                                                                         4,250,000
Delivery equipment – old                                                                          3,000,000
            Gain on exchange (750,000 – 350,000)                                                         400,000

    Original cost                                                                                                      3,000,000
    Less: Accumulated depreciation to date (2,400,000 + 250,000)                        2,650,000
    Book value                                                                                                           350,000

4. Accumulated depreciation                                     1,200,000
Office equipment                                                                                      1,200,000

5. Depreciation (900,000 x 9/12)                                                675,000
            Accumulated depreciation                                                                        675,000
                                                                                                                                                     
    Accumulated depreciation (2,700,000 + 675,000)              3,375,000
    Fire loss                                                                               1,125,000
Machinery                                                                                                  4,500,000

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