Reference no: EM132946454

Questions -

Q1. Arcie Company purchased equipment in January of 2010 for P90,000. The equipment was being depreciated on the straight-line method over an estimated useful life of 20 years, with no residual value. At the beginning of 2020, when the equipment had been in use for 10 years, the company paid P 15,000 to overhaul the equipment. As a result of this improvement, the company estimated that the useful life of the equipment would be extended an additional 5 years. What should be the depreciation expense recorded for this equipment in 2020?

Q2. On January 1, 2019, an entity acquired an equipment with an estimated useful life of 10 years and estimated residual value of P50,000. The depreciation applicable to this equipment was P240,000 for 2021 computed under the sum of years' digits method. What was the acquisition cost of equipment?

Q3. On January 1, 2015, Shella Inc. purchased equipment with a cost of P3,060,000, a useful life of 12 years and no salvage value. The company uses straight-line depreciation. At December 31, 2015, the company determines that impairment indicators are present. The fair value less cost to sell the asset is estimated to be P2,600,0000. The asset's value-in-use is estimated to be P2,365,000. There is no change in the asset's useful life or salvage value. What is the 2015 income statement will report Loss on Impairment?