On January 1, 2019, ABC Company classified PPE as held for sale that had a carrying amount of P2,600,000. On this date, the assets are expected to be sold for P 2,400,000. Reasonable disposal costto be incurre upon sale was expected at P 100,000.As of December 31. 2019. the asset had not been sold. After considering its options, managementdecided to put back the noncurrent asset for use in operations. On that date, ABC's financial managersestimated the noncurrent asset was now expected to be selling at P 2,500,000 with disposal cost of P50,000 while depreciation for 2019 was computed at P 400,00 if the noncurrent asset was notclassified as held for sale.How much is the net effect of classifying NCAHS and reclassifying back to PPE on 2019 net income?(indicate negative sign if decrease)

Profit/Loss as a result of reclassification : Carrying amount asset held for sale - Carrying amount…

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How much is the net effect of classifying NCAHS and reclassifying back to PPE on 2019 net income? (indicate negative sign if decrease)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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On January 1, 2019, Villanueva Company classified noncurrent assets as held for sale that had a carrying amount of P2,500,000. On this date, the assets are expected to be sold for P2,300,000. Reasonable disposal cost to be incurred upon sale was expected at P100,000. As of December 31, 2019, the asset had not been sold. After considering its options, management decided to put back the noncurrent asset for use in operations. On that date, Villanueva's financial managers estimated the noncurrent asset was now expected to be selling at P1,800,000 with the disposal cost of P50,000, while depreciation for 2019 was computed at P500,000 if the noncurrent asset was not classified as held for sales. At how much should the asset be recorded upon reclassification as "held for use" on December 31, 2019 A. 2,500,000 B. 2,200,000 C. 2,000,000 D. 1,950,000
On January 1, 2022, Villanueva Company classified noncurrent assets as held for sale that had a carrying amount of P2,500,000. On this date, the assets are expected to be sold for P2,300,000. Reasonable disposal cost to be incurred upon sale was expected at P100,000. As of December 31, 2022, the asset had not been sold. After considering its options, management decided to put back the noncurrent asset for use in operations. On that date, Villanueva's financial managers estimated the noncurrent asset was now expected to be selling at P2,100,000 with the disposal cost of P50,000, while depreciation for 2022 was computed at P500,000 if the noncurrent asset was not classified as held for sale. At how much should the asset be recorded upon reclassification as “held for use” on December 31, 2022?
On January 1, 2022, Villanueva Company classified noncurrent assets as held for sale that had a carrying amount of P2,500,000. On this date, the assets are expected to be sold for P2,300,000. Reasonable disposal cost to be incurred upon sale was expected at P100,000. As of December 31, 2022, the asset had not been sold. After considering its options, management decided to put back the noncurrent asset for use in operations. On that date, Villanueva's financial managers estimated the noncurrent asset was now expected to be selling at P2,100,000 with the disposal cost of P50,000, while depreciation for 2022 was computed at P500,000 if the noncurrent asset was not classified as held for sale. How much loss shall be taken to profit or loss as a result of reclassifying the asset at December 31, 2022 “held for use”?
On January 1. 2019. ABC Company classified PPE as held for sale that had a carrying amount of P 2,600.000. On this date. the assets are expected to be sold for P 2.400.000. Reasonable disposal cost to be incurred upon sale was expected at P 100.000. Asof December 31, 2019. the asset had not been sold, After considering its options, management decided to put back the noncurrent asset for use in operations. On that date, ABC's financial managers estimated the noncurrent asset was now expected to be selling at P 2.500.000 with disposal cost of P 50,000 while depreciation for 2019 was computed at P 400,00 if the noncurrent asset was not classified as held for sale. At how much should the asset be recorded upon reclassification as PPE on December 31, 2019? 2,200,000 O 2,500,000 O 2,000,000 O 1,750,000
On January 1, 2022, Villanueva Company classified noncurrent assets as held for sale that had a carrying amount of P2,500,000. On this date, the assets are expected to be sold for P2,300,000. Reasonable disposal cost to be incurred upon sale was expected at P100,000. As of December 31, 2022, the asset had not been sold. After considering its options, management decided to put back the noncurrent asset for use in operations. On that date, Villanueva’s financial managers estimated the noncurrent asset was now expected to be selling at P1,800,000 with the disposal cost of P50,000, while depreciation for 2022 was computed at P500,000 if the noncurrent asset was not classified as held for sale. How much is the additional loss recorded at December 31, 2022 upon reclassification of the asset as “held for use”?
Lala Company accounts for noncurrent assets using the cost model. On October 1, 2019, Lala classified a noncurrent asset held for sale. At that date, the asset’s carrying amount was P1,600,000, its fair value was estimated at P1,100,000 and the cost to sell at P100,000. On December 15, 2019, the asset was sold for net proceeds of P925,000. What amount should be included as an impairment loss in Lala’s statement of comprehensive income for the year ended December 31 ,2019?
On June 30, 2022, L Company classified a non-current asset as “Held for Sale.” On this date, before its reclassification, its carrying amount was P5,000,000 and its expected selling price was P4,500,000, with expected cost to sell of P300,000. By December 31, 2022, the asset had not yet been sold, but the management is still committed to a plan to sell it, and the sale is considered to be highly probable. The entity estimated that because of recent changes for the demand of the product that is produced by the asset and expected favorable price movement, the asset was now expected to be selling at P5,500,000 with related cost to sell unchanged. Depreciation from July 1 to December 31 would have been P500,000. What amount of gain shall be recognized at December 31, 2022 as a result of the increase in the fair value less cost to sell of the asset?
On December 31, 2020, the entity classified as held for sale a machine with carrying amount of P6,000,000. On this date, the machine is expected to be sold for P5,520,000. Disposal cost is expected at P240,000. On December 31, 2021, the machine had not been sold and management after considering its options decided to place back the machine into operations. On this date, the entity estimated that the machine is expected to be sold at P5,160,000 with the disposal cost at P60,000. The carrying amount of the machine was P4,800,000 on December 31, 2021 if the noncurrent asset was not classified as held for sale. Required: Compute the impairment loss for 2020.
Lure Corporation is using the cost model for noncurrent assets. On October 1, 2020, the entity classified a noncurrent asset as held for sale. At that date, the carrying amount was P4,500,000, the fair value was estimated at P3,300,000, and the cost of disposal at P450,000. On October 25, 2020, the asset was sold for net proceeds of P2,400,000. What amount should be reported as loss on disposal for the year ended December 31, 2020? P750,000 P1,650,000 P450,000 P2,100,000
Rose Company accounts for noncurrent assets using the cost model. On October 30, 2020, Rose classified a noncurrent asset as held for sale. At that date, the asset’s carrying amount was P750,000, its fair value was estimated at P550,000 and the cost to sell at P75,000. On November 20, 2020, the asset was sold for net proceeds of P400,000. What amount should be included as loss on disposal in Rose statement of comprehensive income for the year ended December 31, 2020?
On January 2, 2021, Big company classified non current asset with a carrying amount of P2,400,000 as held for sale. On this date, the asset is expected to be sold for P2,300,000 with expected cost to sell of P100,000. By December 31, 2021,the asset's fair value is P2,400,000 with estimated disposal cost of P50,000. On January 10, 2022, the asset was sold for P2,000,000. Cost to sell amounts to P35,000How much recovery on impairment is to be recognized on December 31, 2021?
The ABC Company accounts for non-current assets using the cost model. On July 20, 2021, ABC Company classified a non-current asset as held for sale in accordance with PFRS 5. At that date, the asset's carrying amount was P24,500, its fair value was estimated at P31,500 and the costs to sell at P3,150. The asset was sold on Oct 18, 2021 for P31,200. Q-27. 12.How much is the impairment loss and at what amount should the asset be stated in ABC Company's statement of financial position at September 30, 2021? 13.How much is the gain on sale to be reported in the September 30, 2021 statement of income?