2. Lynx Company is planning to dispose of a collection of assets. The entity designated these assets as a disposal group. The carrying amount of these assets immediately before classification as held for sale was P2,000,000. Upon being classified as held for sale, the assets were revalued to P1,800,000. The entity feels that it would cost P100,000 to sell the disposal group. What should be reported as the carrying amount of the disposal group in the entity's accounts after its classification as held for sale? O a. 2,000,000 O b. 1,800,000 O c. 1,700,000 O d. 1,900,000

2. Lynx Company is planning to dispose of a collection of assets. The entity designated these assets as a disposal group. The carrying amount of these assets immediately before classification as held for sale was P2,000,000. Upon being classified as held for sale, the assets were revalued to P1,800,000. The entity feels that it would cost P100,000 to sell the disposal group. What should be reported as the carrying amount of the disposal group in the entity's accounts after its classification as held for sale? O a. 2,000,000 O b. 1,800,000 O c. 1,700,000 O d. 1,900,000

SWFT Individual Income Taxes

43rd Edition

ISBN:9780357391365

Author:YOUNG

Publisher:YOUNG

Chapter8: Depreciation, Cost Recovery, Amortization, And Depletion

Section: Chapter Questions

Problem 53P

See similar textbooks

Similar questions

2. Lynx Company is planning to dispose of a collection of assets. The entity designated these assets as a disposal group. The carrying amount of these assets immediately before classification as held for sale was P2,000,000. Upon being classified as held for sale, the assets were revalued to P1,800,000. The entity feels that it would cost P100,000 to sell the disposal group. What should be reported as the carrying amount of the disposal group in the entity's accounts after its classification as held for sale? a. 2,000,000 b. 1,800,000 c. 1,700,000 d. 1,900,000
N Incorporated plans to dispose a group of assets that form part a disposal group. These assets have the following data on December 31, 2021: Asset Carrying value Inventory 2 million Equipment 5 million Land 20 million Building 15 million Goodwill 3 million Total 45 million The carrying value of the inventory is equal to its net realizable value. On the date of reclassification, the fair value less cost to sell of the disposal group is 40 million. Impairment loss to be recognized on the date of reclassification is: a. 3,000,000 b. 2,000,000 c. 5,000,000 d. Answer not among the choices e. 0 Clear my choice
Surreal Company accounted for non-current assets using the revaluation model. On October 1, 2021, the entity classified a land as held for sale. At that date, the carrying amount of the land was P5,000,000 and the balance in the revaluation surplus was P1,500,000. At same date, the fair value of the land was estimated at P5,500,000 and the cost of disposal at P100,000. On December 31,2021, the fair value less cost of disposal of the land did not change. The land was sold on January 31,2022 for P6,000,000. Required: 1. What amount should be reported as impairment loss for 2021? a. 100,000 b. 400,000 c. 500,000 d. 0 2. What amount should be reported as revaluation surplus on December 31,2021? a. 1,500,000 b. 2,000,000 c. 1,000,000 d. 1,900,000
Surreal Company accounted for non-current assets using the revaluation model. On October 1, 2021, the entity classified a land as held for sale. At that date, the carrying amount of the land was P5,000,000 and the balance in the revaluation surplus was P1,500,000. At same date, the fair value of the land was estimated at P5,500,000 and the cost of disposal at P100,000. On December 31,2021, the fair value less cost of disposal of the land did not change. The land was sold on January 31,2022 for P6,000,000. REQUIRED: 1. What amount should be reported as gain on disposal of land in 2022? a. 1,000,000 b. 2,600,000 c. 500,000 d. 600,000
Surreal Company accounted for non-current assets using the revaluation model. On October 1, 2021, the entity classified a land as held for sale. At that date, the carrying amount of the land was P5,000,000 and the balance in the revaluation surplus was P1,500,000. At same date, the fair value of the land was estimated at P5,500,000 and the cost of disposal at P100,000. On December 31,2021, the fair value less cost of disposal of the land did not change. The land was sold on January 31,2022 for P6,000,000. Required: 1. What is the adjusted carrying amount of the land on December 31,2021? a. 5,000,000 b. 5,500,000 c. 5,400,000 d. 3,500,000
Surreal Company accounted for non-current assets using the revaluation model. On October 1, 2021, the entity classified a land as held for sale. At that date, the carrying amount of the land was P5,000,000 and the balance in the revaluation surplus was P1,500,000. At same date, the fair value of the land was estimated at P5,500,000 and the cost of disposal at P100,000. On December 31,2021, the fair value less cost of disposal of the land did not change. The land was sold on January 31,2022 for P6,000,000. Required: 1. What is the adjusted carrying amount of the land on December 31,2021? a. 5,000,000 b. 5,500,000 c. 5,400,000 d. 3,500,000 2. What amount should be reported as impairment loss for 2021? a. 100,000 b. 400,000 c. 500,000 d. 0 3. What amount should be reported as revaluation surplus on December 31,2021? a. 1,500,000 b. 2,000,000 c. 1,000,000 d. 1,900,000 4. What amount should be reported as gain on disposal of land in 2022? a. 1,000,000 b. 2,600,000 c. 500,000 c. 600,000
3. On December 1, 2021, Violet Company committed to a plan to dispose of the assets of a business component. The disposal meets the requirements to be classified as discontinued operation. On that date, the entity estimated that the loss from the disposition of the assets would be P700,000 and the component’s operating income was P200,000. What amount of pretax loss should be reported for discontinued operation for 2021? A. 900,000 B. 700,000 C. 200,000 D. 500,000 E. None of them
Hindi Kho Kaya Corporation is using the cost model for noncurrent assets. On November 1, 2020, the entity classified a noncurrent asset as held for sale. At that date, the carrying amount was P3,000,000, the fair value was estimated at P2,200,000, and the cost of disposal at P300,000. On November 22, 2020, the asset was old for net proceeds of P1,600,000. What amount should be reported as loss on disposal for the year ended December 31, 2020? ₱300,000 ₱1,400,000 ₱500,000 ₱1,100,000 What is the impairment loss for 2020? ₱800,000 ₱1,400,000 ₱1,100,000 d. ₱1,700,000
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
On December 31, 20x1, an entity classified a building with an original cost of P20,000,000, carrying amount of P8,000,000 and remaining useful of 8 years as held for sale. The entity uses the straight-line method of depreciationwith no residual value for this asset. The fair value of the building on December 31, 20x1 is P7,000,000 while costs to sell are estimated at P200,000. The building is being marketed at a sale price of P7,000,000. On December 31, 20x2, the building remains unsold. The fair value of the building on December 31, 20x2 is P6,800,000 while costs to sell are estimated at P200,000. The entity decreased the sale price to P6,000,000.On December 31, 20x3, the building still remains unsold. The fair value of the machinery on December 31, 20x3 is P8,800,000 while costs to sell are estimated at P200,000. The failure to locate a buyer and complete the sale is beyond the entity’s control. The entity further decreased the sale price to P5,800,000. On December 31. 20x4, the…
High, a parent company, acquired Low, an unincorporated entity, for $2,800,000. A fair value exercise performed on Low's net assets at the date of purchase showed: $'000 Property, plant and equipment 3,000 Identifiable intangible asset 500 Inventory 300 Trade receivables less payables 200 4,000 How should the purchase of Low be reflected in High's consolidated statement of financial position? Record the net assets at their values shown above and credit profit or loss with $1,200,000 Record the net assets at their values shown above and credit High's consolidated goodwill with $1,200,000 Write off the intangible asset ($500,000), record the remaining net assets at their values shown above and credit profit or loss with $700,000,000 Record the purchase as a financial asset investment at $2,800,000
Arizona Corp. acquired the business Data Systems for $320,000 cash and assumed all liabilities at the date of purchase. Data's books showed tangible assets of $260,000, liabilities of $40,000, and stockholder's equity of $220,000. An appraiser assessed the fair market value of the tangible assets at $250,000 at the date of acquisition. Compute the amount of good will acquired Record the qcquisition in a financial statements model When will teh goodwill be written off under the impairment rules Record the acquisition in general journal format