Beemo Company purchased an equipment on January 1, 2018 for P150,000. The equipment is being depreciated using the straight-line method over its projected useful life of 10 years. on December 31, 2019, it was determined that the asset’s recoverable amount was only P96,000. Assume that this was properly computed and that recognition of the impairment was warranted. On December 31, 2020, the asset’s recoverable amount was determined to be P111,000 and management believes that the impairment loss previously recognized should be reversed. How much impairment loss should be recognized on December 31, 2019? What is the asset’s carrying amount on December 31, 2020? What would have been the asset’s carrying amount at December 31, 2020, had the impairment not been recognize in 2018? How much impairment recovery should be reported in 2020 income statement?
Beemo Company purchased an equipment on January 1, 2018 for P150,000. The equipment is being depreciated using the straight-line method over its projected useful life of 10 years. on December 31, 2019, it was determined that the asset’s recoverable amount was only P96,000. Assume that this was properly computed and that recognition of the impairment was warranted. On December 31, 2020, the asset’s recoverable amount was determined to be P111,000 and management believes that the impairment loss previously recognized should be reversed. How much impairment loss should be recognized on December 31, 2019? What is the asset’s carrying amount on December 31, 2020? What would have been the asset’s carrying amount at December 31, 2020, had the impairment not been recognize in 2018? How much impairment recovery should be reported in 2020 income statement?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Beemo Company purchased an equipment on January 1, 2018 for P150,000. The equipment is being
- How much impairment loss should be recognized on December 31, 2019?
- What is the asset’s carrying amount on December 31, 2020?
- What would have been the asset’s carrying amount at December 31, 2020, had the impairment not been recognize in 2018?
- How much impairment recovery should be reported in 2020 income statement?
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