10. In accordance with PAS 1, which of the following gains or losses from reclassification of financial assets need not be presented separately in the profit or loss section or the statement of profit or loss? a. Reclassification of financial assets out of the amortized cost measurement category to FVTPL. b. Reclassification of financial assets out of the FVTOCI measurement category to FVTPL. c. Reclassification of financial assets out of the FVTPL measurement category. d. None of these. 11. In accordance with PAS 1, which of the following expenses need not be presented separately in the profit or loss section or the statement of profit or loss? a. Finance costs b. Share of loss of associates c. Tax expense d. Depreciation expense
10. In accordance with PAS 1, which of the following gains or losses from reclassification of financial assets need not be presented separately in the profit or loss section or the statement of profit or loss?
a. Reclassification of financial assets out of the amortized cost measurement category to FVTPL.
b. Reclassification of financial assets out of the
FVTOCI measurement category to FVTPL.
c. Reclassification of financial assets out of the FVTPL
measurement category.
d. None of these.
11. In accordance with PAS 1, which of the following expenses need not be presented separately in the profit or loss section or the statement of profit or loss?
a. Finance costs
b. Share of loss of associates
c. Tax expense
d.
12. You are preparing the income statement of Anonymous Company for the year ended December 31, 2020. You determine that company's income from continuing operations before income taxes is P2,400,000. At this point, you are considering the proper treatment of the items listed below. Unless otherwise indicated, assume that none of the items listed are included in the P2,400,000 income figure.
a. Because of changes in technology, inventory costing P100,000 was written off as obsolete in
2020. The company had never recorded this type
of loss before.
b. An unusual earthquake damaged the company's plant on January 10, 2021 resulting in a loss to
Anonymous of P400,000.
c. A loss of P360,000 was sustained on April 5, 2020 as a result of typhoon damage to the company's warehouse in Davao. Typhoons rarely occur in that area.
d. Prior to 2020, Anonymous used an accelerated depreciation method for its plant equipment. In
2020, Anonymous changed to the straight-line method for previously acquired equipment and new acquisitions. At December 31, 2019, the carrying amount of plant equipment was P7,000,000. If the straight-line method had previously been used, the carrying amount would have been P7,500,000 on December 31, 2019.
e. In 2020, Anonymous changed its method of accounting for inventory from direct costing, which was used in previous years, to absorption costing.
The 2020 ending inventory has been recorded on the absorption cost basis, but no adjustment has been made to beginning inventory, which has a total cost of P2,300,000, made up of P1,400,000 direct materials and P900,000 direct labor. The manufacturing overhead application rate is 75% of direct labor cost.
f. On July 1, 2020, Anonymous paid bondholders P1,200,000 to retire its bonds payable with a carrying amount of P950,000.
How much should be reported as income from continuing operations before income taxes for the year ended December 31, 2020?
a. P1,690,000
b. P1,115,000
c. P1,290,000
d. P1,015,000
Step by step
Solved in 2 steps
