Reference no: EM132800122
Problem - Lyre Instruments' property, plant and equipment disclosed the following data on December 31, 2019:
|
|
Asset J
|
Asset E
|
Asset R
|
Asset I
|
|
Original cost
|
P70,000
|
P102,000
|
P160,000
|
P160,000
|
|
Year purchased
|
2014
|
2015
|
2016
|
2018
|
|
Useful life
|
10 years
|
15,000 hours
|
15 years
|
10 years
|
|
Residual value
|
P6,200
|
P6,000
|
P10,000
|
P10,000
|
|
Depreciation method
|
Sum-of-years' digits
|
Working hours
|
Straight-line
|
Double-declining balance
|
|
Accumulated depreciation, Dec. 31, 2019
|
P52,200
|
P70,400
|
P40,000
|
P57,600
|
All of the assets were purchased at the beginning of the year. The following transactions occurred during 2020:
a. On January 2, Asset J was sold for P26,000.
b. On December 31, it was determined that Asset E had been used 2,100 hours during 2020.
c. On December 31, before computing depreciation expense on Asset R, the management of Lyre decided the useful life remaining from January 1, 2020 was 10 years.
Required -
1. How much is the gain or loss on the sale of Asset J? (Indicate if gain or loss.)
2. How much is the carrying amount of Asset E on December 31, 2020?
3. How much is the depreciation on Asset R in 2020?
4. How much is the balance of the Asset I's accumulated depreciation on December 31, 2020?