ABC Company acquired forest assets for a lump sum amount of P32,000,000 which is equal to the lump sum value of the group assets. At the time of purchase, the company isnunable to determine the fair value of the trees separately since no active market was clearly available. The other assets in the group had a determinavle fair value. The forest assets are listed below and their relative fair value less point of sell costs: Land under trees P2,300,000 Roads in forest P2,000,000 What amount should be the biological asset be initially recorded? a. 2,300,000 b. 2,000,000 c. 30,000,000 d. 27,700,000
ABC Company acquired forest assets for a lump sum amount of P32,000,000 which is equal to the lump sum value of the group assets. At the time of purchase, the company isnunable to determine the fair value of the trees separately since no active market was clearly available. The other assets in the group had a determinavle fair value. The forest assets are listed below and their relative fair value less point of sell costs: Land under trees P2,300,000 Roads in forest P2,000,000 What amount should be the biological asset be initially recorded? a. 2,300,000 b. 2,000,000 c. 30,000,000 d. 27,700,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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ABC Company acquired forest assets for a lump sum amount of P32,000,000 which is equal to the lump sum value of the group assets. At the time of purchase, the company isnunable to determine the fair value of the trees separately since no active market was clearly available. The other assets in the group had a determinavle fair value. The forest assets are listed below and their relative fair value less point of sell costs:
Land under trees P2,300,000
Roads in forest P2,000,000
What amount should be the biological asset be initially recorded?
a. 2,300,000
b. 2,000,000
c. 30,000,000
d. 27,700,000
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