Question
Mortal Company acquired a machine for P3,200,000 on August 31, 2017. The machine has a 5-year useful life, a P500,000 residual value, and was depreciated
Mortal Company acquired a machine for P3,200,000 on August 31, 2017. The machine has a 5-year useful life, a P500,000 residual value, and was depreciated using the straight line method. On May 31, 20120, a test for recoverability revealed that the expected net future undiscounted cash inflows related to the continued use and eventual disposal of the machine amount to P1,500,000. The fair value less cost of disposal of the machine on May 31, 2020 is P1,350,000 with no residual value. Assuming a loss on impairment is recognized on May 31, 2020, what is the depreciation of the machine for June 2020?
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