Happy
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
Chapter12: Intangibles
Section: Chapter Questions
Problem 18E
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Question
Happy Inc. accounted for noncurrent assets using the revaluation surplus 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.
Was is the impairment loss in 2021?
A. 400,000
B. 100,000
C. 500,000
D. 0
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