9. How much impairment loss is to be recorded by Frozen relating to the non-current assets held for sale? 10. At what amount should the non-current assets held for sale be recorded on Feb. 14, 2022? 11. How much gain(loss) is to be reported by Frozen on the disposal of the non-current assets held for sale?
9. How much impairment loss is to be recorded by Frozen relating to the non-current assets held for sale? 10. At what amount should the non-current assets held for sale be recorded on Feb. 14, 2022? 11. How much gain(loss) is to be reported by Frozen on the disposal of the non-current assets held for sale?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:8. Brown Company uses fair value model for its investrnent property. At December 31, 2021, the company
has the following property items.
Acquisition
cost/Carrying
Fair value at
Property item
value
12/31/21
Land held for future plant site
Land held for a currently undetermined future use
Land and building acquired under finance lease being used in
10,000,000
12,500,000
5,000,000
6,500,000
14,000,000
operations.
Building (30% of the space is owner occupied and the remainder
is being leased to others under operating leases.
Building being leased out under finance lease.
Building being used by the company for its operations
Building being leased out under operating lease
Equipment being leased out under operating lease
15,000,000
12,000,000
10,000,000
8,500,000
9,000,000
7,900,000
8,500,000
6,500,000
7,000,000
2,200,000
1,700,000
What is the correct total of investment property reported by Brown Company at December 31, 2021?
On February 14, 2022, Frozen Company classified a non-current asset as held for sale. At that time, the
asset's carrying amount was P64,000. It's fair value was estimațed at P48,000 and the cost to sell at P3,800.
On May 9, 2022, the asset was sold for P42,000 and paid transaction costs of P2,000. The company accounts
for non-current assets using the cost model.
9. How much impairment loss is to be recorded by Frozen relating to the non-current assets held for sale?
10. At what amount should the non-current assets held for sale be recorded on Feb. 14, 2022?
11. How much gain(loss) is to be reported by Frozen on the disposal of the non-current assets held for sale?
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