C. An entity is committed to close a factory in 10 months and shall terminate the employment of all the remaining employees of the factory. Under the termination plan, an employee leaving before closure of factory shall receive on termination date a cash payment of P20,000. However, an employee that renders service until closure of the factory shall receive P60,000. There are 120 employees at the factory. The entity expects 100 employees to leave before closure and 20 employees to render service until closure. REQUIRED: 10. What amount should be recognized as termination benefit?
C. An entity is committed to close a factory in 10 months and shall terminate the employment of all the remaining employees of the factory. Under the termination plan, an employee leaving before closure of factory shall receive on termination date a cash payment of P20,000. However, an employee that renders service until closure of the factory shall receive P60,000. There are 120 employees at the factory. The entity expects 100 employees to leave before closure and 20 employees to render service until closure. REQUIRED: 10. What amount should be recognized as termination benefit?
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter17: Advanced Issues In Revenue Recognition
Section: Chapter Questions
Problem 10P
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Question
C. An entity is committed to close a factory in 10 months and shall terminate the employment of all the
remaining employees of the factory. Under the termination plan, an employee leaving before closure of
factory shall receive on termination date a cash payment of P20,000. However, an employee that renders
service until closure of the factory shall receive P60,000. There are 120 employees at the factory. The entity
expects 100 employees to leave before closure and 20 employees to render service until closure.
REQUIRED:
10. What amount should be recognized as termination benefit?
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