A contractor bought a crane for erecting tall buildings. It was invoiced from JapanCIF (cost, insurance,...

A contractor bought a crane for erecting tall buildings. It was invoiced from JapanCIF (cost, insurance, freight) Manila at P2,500,000. Brokerage, bank, customs’duties, permits, etc. total P1,200,000. At the end of 10 years, he expects to sell itfor P500,000. Construct a schedule of the book value at the end of each year usingthe following methods: (a) Straight-Line Formula, (b) Sinking Fund Formula at 12%,(c) Matheson Formula (d) Double Declining Method and (e) SYD Method

Show complete solution. answe a, b,c,d,e.

Expert Solution

Ally Wells answered 2 years ago

A contractor bought a crane for erecting tall buildings. It was invoiced from Japan CIF (cost,...

A contractor bought a crane for erecting tall buildings. It was invoiced from Japan CIF (cost, insurance, freight) Manila at P2,500,000. Brokerage, bank, customs’ duties, permits, etc. total P1,200,000. At the end of 10years, he expects to sell it for P500,000. Determine the book value at the beginning of year 5 using the: A)Straight-Line Method. B) Sinking Fund Method at 12%. C) Matheson Formula Method. D) Double Declining Balance Method. E) Sum of the Years Digit Method.

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