Show solutions

PROBLEM #4 GG Company replaced a portion of a building for P3,250,000. Before the replacement, the building had the following available information: Cost, P12,000,000; Carrying amount: P8,400,000; 30% depreciated; original life, 30 years. REQUIRED: Prepare the journal entry to record the replacement and subsequent annual depreciation under each of the following independent assumptions: a) The portion of the building being replaced had an original cost of P3,000,000. b) Separate identification of the replaced part is not practicable. The appropriate discount rate is 7%. (Round of the present value factor to 4 decimal places.)