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    Exercises (Adjusting)

    Uploaded by

    Joey G. Santos
    - Pedro Reyes purchased a delivery vehicle for PHP250,000 on January 1, 2016 that has a useful life of 10 years and salvage value of PHP10,000. - If the accounting period is January - December 2016, the depreciation expense is PHP24,000. - If purchased on April 1, 2016, the depreciation expense for January - December 2016 period is PHP18,000. - If the accounting period is January 2016 only, the depreciation expense for January is PHP2,000.

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    Exercises (Adjusting)

    Uploaded by

    Joey G. Santos
    100 views7 pages
    - Pedro Reyes purchased a delivery vehicle for PHP250,000 on January 1, 2016 that has a useful life of 10 years and salvage value of PHP10,000. - If the accounting period is January - December 2016, the depreciation expense is PHP24,000. - If purchased on April 1, 2016, the depreciation expense for January - December 2016 period is PHP18,000. - If the accounting period is January 2016 only, the depreciation expense for January is PHP2,000.

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    - Pedro Reyes purchased a delivery vehicle for PHP250,000 on January 1, 2016 that has a useful life of 10 years and salvage value of PHP10,000. - If the accounting period is January - December 2016, the depreciation expense is PHP24,000. - If purchased on April 1, 2016, the depreciation expense for January - December 2016 period is PHP18,000. - If the accounting period is January 2016 only, the depreciation expense for January is PHP2,000.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    100 views7 pages

    Exercises (Adjusting)

    Uploaded by

    Joey G. Santos
    - Pedro Reyes purchased a delivery vehicle for PHP250,000 on January 1, 2016 that has a useful life of 10 years and salvage value of PHP10,000. - If the accounting period is January - December 2016, the depreciation expense is PHP24,000. - If purchased on April 1, 2016, the depreciation expense for January - December 2016 period is PHP18,000. - If the accounting period is January 2016 only, the depreciation expense for January is PHP2,000.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    of 7

    EXERCISES

    (ADJUSTING)
    Pedro Reyes purchased a delivery vehicle on January
    1, 2016 amounting to PHP250,000. It is estimated
    that the vehicle will be useful for 10 years. The vehicle
    can be sold for PHP10,000 at the end of its useful life.
    If the accounting period being reported by Pedro is
    one (1) year from January – December 2016, how
    much is the depreciation expense?
    Solution:
    Annual Depreciation = (Acquisition Cost – Salvage or
    Residual Value) / Useful Life
    Annual Depreciation = (250,000 -10,000) / 10
    Answer = PHP24,000
    Pedro Reyes purchased a delivery vehicle on April 1, 2016
    amounting to PHP250,000. It is estimated that the vehicle will
    be useful for 10 years. The vehicle can be sold for PHP10,000
    at the end of its useful life. If the accounting period being
    reported by Pedro is one (1) year from January-December
    2016, how much is the depreciation expense?
    Solution:
    Annual Depreciation = (Acquisition Cost – Salvage or Residual Value) /
    Useful Life
    Annual Depreciation = (250,000 -10,000) / 10
    Answer = PHP24,000
    Multiply the Annual Depreciation of PHP24,000 to the number of
    months in used/12, thus 24,000 x (9/12) Where the ‘9’ represents the
    number of month from April to December. Answer = PHP18,000
    Pedro Reyes purchased a delivery vehicle on January 1, 2016
    amounting to PHP250,000. It is estimated that the vehicle will
    be useful for 10 years. The vehicle can be sold for PHP10,000
    at the end of its useful life. If the accounting period being
    reported by Pedro is one (1) month (January 2016), how much
    is the depreciation expense for the month?

    Solution:
    Annual Depreciation = (Acquisition Cost – Salvage or Residual Value) /
    Useful Life
    Annual Depreciation = (250,000 -10,000) / 10 = P24,000
    Answer = PHP24,000 / 12 = PHP2,000 for January 2016
    For each of the following items, write the journal entry first (if
    one is needed) to record the transactions; and then the
    adjusting entry, if any is required, for the end of the accounting
    year of Ron Car Rental Company on December 31, 2016.

    On December 1, borrowed PHP300,000 cash from Nation Bank by


    issuing a promissory note with an interest of 12% per annum payable
    in three months
    For each of the following items, write the journal entry first (if
    one is needed) to record the transactions; and then the
    adjusting entry, if any is required, for the end of the accounting
    year of Ron Car Rental Company on December 31, 2016.

    On December 1, paid rental for six months beginning December 1,


    2016 to May 31, 2017, at PHP3,000 per month.
    For each of the following items, write the journal entry first (if
    one is needed) to record the transactions; and then the
    adjusting entry, if any is required, for the end of the accounting
    year of Ron Car Rental Company on December 31, 2016.

    On December 31, 2016, received telephone bills for the month


    December amounting to PHP5,600. The bill will be paid on January
    2017.

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