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- On December 31, 20x1, Entity A determines that its building is impaired. Entity A gathers the following information: Building 2,000,000 Accumulated depreciation 600,000 Fair value less costs of disposal (FVLCD) 900,000 Value in use (VIU) 1,080,000 After the impairment, the building is assessed to have a remaining useful life of six years and no residual value. How much is the impairment loss? a. 320,000 b. 180,000 c. 500,000 d. 270,000On December 31, 20x1, Entity A determines that its building is impaired. Entity A gathers the following information: Building 2,000,000 Accumulated depreciation 600,000 Fair value less costs of disposal (FVLCD) 900,000 Value in use (VIU) 1,080,000 After the impairment, the building is assessed to have a remaining useful life of six years and no residual value. On December 31, 20x2, Entity A determines an indication that the impairment loss recognized in the prior period may no longer exist. The revised recoverable amount of the building on December 31, 20x2 is ₱1,280,000. If no impairment loss had been recognized in the prior period, the carrying amount of the building on December 31, 20x2 would have been ₱1,200,000. How much is the gain on reversal of impairment on December 31, 20x2?On December 31, 20x1, Entity A determines that its building is impaired. Entity A gathers the following information: Building 2,000,000 Accumulated depreciation 600,000 Fair value less costs of disposal (FVLCD) 900,000 Value in use (VIU) 1,080,000 After the impairment, the building is assessed to have a remaining useful life of six years and no residual value. On December 31, 20x2, Entity A determines an indication that the impairment loss recognized in the prior period may no longer exist. The revised recoverable amount of the building on December 31, 20x2 is ₱1,280,000. If no impairment loss had been recognized in the prior period, the carrying amount of the building on December 31, 20x2 would have been ₱1,200,000. How much is the gain on reversal of impairment on December 31, 20x2? a. 314,351 b. 312,156 c. 303,315 d. 300,000
- On January 1, 2020, Elite Company purchased equipment with a cost of P11,000,000, useful life of 10 years and no residual value. The entity used straight line depreciation. At every year-end, the entity determined that impairment indicators are present. There is no change in the useful life or residual value. The following information is available for impairment testing: December 31, 2020: Fair Value less Cost of Disposal - P8,100,000 Value in Use - P8,550,000 December 31, 2021 Fair Value less Cost of Disposal - P8,400,000 Value in Use - P8,200,000 1. What is the impairment loss for 2020? 2. What is the gain on reversal of impairment for 2021? 3. What is the depreciation for 2022?On December 31, 20x1, Entity A determines that its building is impaired. The following information is gathered: Building Accumulated Depreciation Fair Value less Cost of Disposal 1,000,000 200,000 600,000 580,000 Value in Use How much is the impairment loss?On January 2, 2020, Quezon Inc. purchased equipment with a cost of P10,500,000, a useful life of 12 years and no salvage value. The Company uses sum-of-the-years-digit method of depreciation. At December 31, 2020 and December 31, 2021, the company determines that impairment indicators are present. The following information is available for impairment testing at each year end: 12/31/2020 12/31/2021 Fair value less cost to sell P8,515,000 P7,530,000 Value-in-use P8,551,000 P7,315,000 There is no change in the asset's useful life or salvage value. The 2021 income statement will report gain on recovery of?
- On January 1, 2020, Joker Company purchased equipment with cost of P10,000,000, useful life of 10 years and no residual value. The entity used straight line depreciation. On December 31, 2020 and December 31, 2021, the entity determined that impairment indicators are present. The following information is available for impairment testing at each year end: December 31, 2020 December 31, 2021Fair value less cost of disposal 8,100,000 8,400,000Value in use 8,550,000 8,200,000 There is no change in useful life or residual value. What amount should be reported in the income statement for 2021?As a result of its annual assessment of property, plant, and equipment for indications of impairment, an entity determines that equipment with a carrying amount of $46,000 (cost of $62,000; accumulated depreciation of $16,000) may be impaired due to technological obsolescence. Assume that the asset's value in use is determined to be $38,600 and its fair value less costs of disposal (of $2,100) is $41,200. In addition, the expected future undiscounted net cash flows from the use of the asset and its later disposal are estimated to be $44,100. (a1) Compare the accounting for impairment of the equipment under IFRS versus ASPE IFRS Impairment loss ASPERiley acquired a non-current asset on 1 October 20W9 (ie 10 years before 20X9) at a cost of $100,000 which had a useful life of ten years and a nil residual value. The asset had been correctly depreciated up to 30 September 20X4. At that date the asset was damaged and an impairment review was performed. On 30 September 20X4, the fair value of the asset less costs of disposal was $30,000 and the expected future cash flows were $8,500 per annum for the next five years. The current cost of capital is 10% and a five-year annuity of $1 per annum at 10% would have a present value of $3.79. What amount would be charged to profit or loss for the impairment of this asset for the year ended 30 September 20X4?
- On January 1, 2021, Bug Company purchased equipment with a cost of P10,440,000, a useful life of 10 years and no salvage value. The Company uses straight-line depreciation. At December 31, 2021 and December 31, 2022, the company determines that impairment indicators are present. The following information is available for impairment testing at each year end: 12/31/2021 12/31/2022 Fair value less cost to sell P9,115,000 P8,850,000 Value-in-use P9,155,000 P8,815,000 There is a change in the asset's useful life at the end of 2021 to 15 years from the date of acquisition. Which of the following statements is (are) correct if Bug Company uses revaluation model to account for this asset? Statement 1: The balance of revaluation surplus at the end of 2022 is P348.929. Statement 2: A gain on recovery of P223,786 is reported in Bug's income statement for year ended December 31, 2022. Statement 3: The asset is reported as of December 31, 2022 at P8,724,857. a. Only statement 1 is…On January 1, 2021, Bug Company purchased equipment with a cost of P10,440,000, a useful life of 10 years and no salvage value. The Company uses straight-line depreciation. At December 31, 2021 and December 31, 2022, the company determines that impairment indicators are present. The following information is available for impairment testing at each year end: 12/31/2021 12/31/2022 Fair value less cost to sell P9,115,000 P8,850,000 Value-in-use P9,155,000 P8,815,000 There is a change in the asset’s useful life at the end of 2021 to 15 years from the date of acquisition. Which of the…On January 2, 2020, Quezon Inc. purchased equipment with a cost of P10,500,000, a useful life of 12 years and no salvage value. The Company uses sum-of-the-years-digit method of depreciation. At December 31, 2020 and December 31, 2021, the company determines that impairment indicators are present. The following information is available for impairment testing at each year end: 12/31/20 Fair value less cost to sell P8,515,000 Value-in-use P8,551,000 12/31/21 Fair value less cost to sell P7,530,000 Value-in-use P7,315,000 There is no change in the asset’s useful life or salvage value. The 2021 income statement will report gain on recovery of?