Problem 4 (30 marks)

The following data pertain to Earth Corporation’s property, plant and equipment for 2022.

Audited balances at December 31, 2021: DEBIT CREDIT

Land P7,500,000
Buildings 30,000,000
Accumulated depreciation- Buildings 6,577,500
Machinery and equipment 22,500,000
Accumulated depreciation- Machinery and 6,250,000
equipment
Delivery equipment 5,750,000
Accumulated depreciation- Delivery equipment 4,230,000
Depreciation data: Depreciation Method Useful Life
Buildings 150% declining-balance 25 years
Machinery and Equipment Straight-line 10 years
Delivery Equipment Sum-of-the-years’-digits 4 years
Leasehold Improvement Straight-line