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Sunday, November 14, 2010

Valix Finacc vol 1 Problem 17-19

Financial Accounting Volume 1 2008 Valix-Peralta
Chapter 17 Problem 17-19



1. Old building (4,672,200 x 10%)                                                                                  467,220    
    New building
               Direct cost                                                                         2,220,000
               Fixed (15,000 x 25)                                                                 375,000
               Variable (15,000 x 27)                                                            405,000
               Total cost                                                                           3,000,000
    3,000,000 x 10%                                                                                                        300,000
    Total depreciation                                                                                                   767,220

    Fixed rate (100 / 20 x 2)                                                                                                 10%
                                                                                                                                   

2. Old machinery (1,380,000 / 10)                                                                                138,000
    New machinery
            Invoice cost                                                                             356,000
            Concrete embedding                                                   18,000
            Wall demolition                                                                           7,000
            Rebuilding of wall                                                                     19,000
            Total cost                                                                                 400,000
    400,000 / 10 x 6/12                                                                                                     20,000
    Total depreciation                                                                                                   158,000

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