For letters a to d, identify how much to add or deduct from the Investment in Associate account of ABC based on the following transactions or events: a. As of Jan. 1, 2021, the fair value of the inventory of X was P100,000 higher than its carrying value. All of the inventory were sold as of the end of the year. b. The fair value of equipment held by X is P500,000 while its carrying value is P360,000 as of the beginning of the year. It has a remaining useful life of 3 years as of Dec. 31, 2021. c. X sold inventories costing P150,000 to ABC for P200,000. Only 75% of these inventories were sold by ABC to third parties as of the end of the year. d. Actuarial gains for the year totaled P400,000.

SWFT Comprehensive Vol 2020
43rd Edition
ISBN:9780357391723
Author:Maloney
Publisher:Maloney
Chapter14: Property Transact Ions: Capital Gains And Losses, § 1231, And Recapture Provisions
Section: Chapter Questions
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For letters a to d, identify how much to add or deduct from the Investment in Associate account of ABC based on the following transactions or events:

a. As of Jan. 1, 2021, the fair value of the inventory of X was P100,000 higher than its carrying value. All of the inventory were sold as of the end of the year.

b. The fair value of equipment held by X is P500,000 while its carrying value is P360,000 as of the beginning of the year. It has a remaining useful life of 3 years as of Dec. 31, 2021.

c. X sold inventories costing P150,000 to ABC for P200,000. Only 75% of these inventories were sold by ABC to third parties as of the end of the year.

d. Actuarial gains for the year totaled P400,000.

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