1 . Palmas bought a franchise from Sister Company on January 1, 2019, for P 700,000. The carrying amount of the franchise on Sister's books on January 1, 2019 was P 1,00,000 The franchise agreement had an estimated useful life of 30 years. Because Palmas must enter a competitive bidding at the end of 2018, it is unlikely that the franchise will be retained beyond 2028. What amount should be amortized for the year ended December 31, 2020?

2. Palmas purchased the license for distribution of a popular consumer product on January 1, 2020, for P 300,000. It is expected that this product will generate cash flows for an indefinite period of time. The license has an initial term of 5-years but by paying a nominal fee, Palmas can renew the license indefinitely for successive 5-year terms. What amount should be amortized for the year ended December 31, 2020?

In early January 2019, Ron Corporation applied for a trade name, incurring legal costs of P 180,000. In January 2020, Ron incurred P 78,000 of legal fees in a successful defense of its trade name.

3-4. Compute 2019 amortization, December 31, 2019 book value if the company amortizes the trade name over 10 years.

5. During the current year, Quean Company made the following expenditures relating to the plant building:

Continuing and frequent repairs

400,000

Repainting of the plant building

100,000

Major improvements to the electrical wiring system

300,000

Partial replacement of roof tiles

150,000

The total amount that should be charged to repair and maintenance expense in the current year is.

6. During the current year, Prestigious Company installed a production assembly line to manufacture furniture. In the current year, the entity purchased a new machine and improved the assembly line to install the machine. The improvement did not increase the estimated useful life of the assembly line, but it did not result in significant increase in production.

The following expenditures were incurred in connection with the project:

Machine

750,000

Labor to install machine

140,000

Parts added in improving the assembly line to provide future benefits

400,000

Labor and overhead to improve the assembly line

180,000

The total amount that should be capitalized is.

7. During the current year, Printable Company incurred the following costs for a printing press:

Purchase of collating and stapling attachment

840,000

Installment of attachment

360,000

Replacement parts for overhaul press

260,000

Labor and overhead in connection with overhaul

140,000

The overhaul resulted in a significant increase in production. Neither the attachment nor the overhaul increased the estimated useful life of the press.

The total amount that should be capitalized is.

Doghot Company purchased a machine for P4,500,000 on January 1,2019. The machine has an estimated useful life of four years and a residual value of P500,000.

8. Using sum of the years' digits method, what is the accumulated depreciation on December 31, 2020?

9. Using double declining method, what is the depreciation expense for the year 2020?