31, 2021, Max Company committed to a plan to discontinue the fair value of the facilities was P1,000,000 less than carrying ama

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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4. What amount should be reported as loss from
discontinued operation in 2021? *
Problem B. On December 31, 2021, Max Company committed to a plan to discontinue the operations of
Underwear Division. The fair value of the facilities was P1,000,000 less than carrying amount on
December 31, 2021.
The division's operating loss for 2021 was P2,000,000 and the division was actually sold for P1,200,000
less than the carrying amount in 2022. The entity estimated that the division's operating loss for 2022
would be P500,000. The income tax rate is 30%.
4. What amount should be reported as loss from discontinued operation in 2021?
Transcribed Image Text:4. What amount should be reported as loss from discontinued operation in 2021? * Problem B. On December 31, 2021, Max Company committed to a plan to discontinue the operations of Underwear Division. The fair value of the facilities was P1,000,000 less than carrying amount on December 31, 2021. The division's operating loss for 2021 was P2,000,000 and the division was actually sold for P1,200,000 less than the carrying amount in 2022. The entity estimated that the division's operating loss for 2022 would be P500,000. The income tax rate is 30%. 4. What amount should be reported as loss from discontinued operation in 2021?
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