Reference no: EM132947949
Questions -
Q1) DAFFODIL Company had the following transactions pertaining to its new office building: Purchase price of land -1,200,000; Legal fees for contracts to purchase land -140,000; Architect's fee - 256,000; Demolition of old building on site -315,000; Sale of scrap from old building -71,000; Construction cost of new building (fully completed) -2,450,000; Fire insurance policy on the newly constructed building for the whole year starting on the day it was completed -250,000. At what amount should the building be shown in DAFFODIL's statement of financial position of?
Q2) On August 31, 2019, CAMELLIA Company purchased a new machinery for 540,000. The machinery has an estimated useful life of 5 years and depreciation is computed using the SYD method. Estimated salvage value of the machine is 60,000. If CAMELLIA decides to change its depreciation method to straight-line at the start of 2021, what is the depreciation expense for the year ended December 31, 2021?
Q3) On August 31, 2019, CAMELLIA Company purchased a new machinery for 540,000. The machinery has an estimated useful life of 5 years and depreciation is computed using the SYD method. Estimated salvage value of the machine is 60,000. What is the total accumulated depreciation on December 31, 2020?
Q4) BOUGAINVILLEA Company acquired a building on January 1, 2017 at a cost of 20,000,000. The building had a useful life of six years and residual value of 2,000,000. The building was revalued on January 1, 2020 and the revaluation revealed replacement cost of 30,000,000, residual value of 4,000,000 and revised useful life of 8 years from the date of acquisition. What is the revaluation surplus on January 1, 2020?
Q5) ANEMONE Company engaged your services to compute the goodwill in the purchase of another company which provided the following:
Net Income:
2018------> 2,000,000
2019------> 2,500,000
2020------> 3,900,000
Net Assets:
2018------> 7,800,000
2019------> 8,700,000
2020------> 9,000,000
Goodwill is measured by capitalizing excess earning at 25% with normal return on average net assets at 20%. How much is the goodwill.