Brave Corporation acquired equipment on January 3, 2018 at a cost of P100,000. The estimated useful life of the equipment is 10 years with estimated residual value of P10,000. The company uses straight-line depreciation, computed to the nearest month. On October 1, 2021, the equipment was made "held for sale". It's fair value on this date was P50,000 and the cost to sell was estimated at P2,000. In January 2022, the asset was sold for P50,000 and disposal cost incurred amounted to P3,000. (Brave Corporation uses Fair value model) 12. At what amount should the non-current assets held for sale be recorded on Oct. 1, 2021? 13. How much impairment loss is to be recorded by Brave relating to the non-current assets held for sale? 14. How much gain(loss) is to be reported by Frozen on the disposal of the non-current assets held for sale?
Brave Corporation acquired equipment on January 3, 2018 at a cost of P100,000. The estimated useful life of the equipment is 10 years with estimated residual value of P10,000. The company uses straight-line depreciation, computed to the nearest month. On October 1, 2021, the equipment was made "held for sale". It's fair value on this date was P50,000 and the cost to sell was estimated at P2,000. In January 2022, the asset was sold for P50,000 and disposal cost incurred amounted to P3,000. (Brave Corporation uses Fair value model) 12. At what amount should the non-current assets held for sale be recorded on Oct. 1, 2021? 13. How much impairment loss is to be recorded by Brave relating to the non-current assets held for sale? 14. 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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Brave Corporation acquired equipment on January 3, 2018 at a cost of P100,000. The estimated useful life of the equipment is 10 years with estimated residual value of P10,000. The company uses straight-line depreciation , computed to the nearest month. On October 1, 2021, the equipment was made "held for sale". It's fair value on this date was P50,000 and the cost to sell was estimated at P2,000. In January 2022, the asset was sold for P50,000 and disposal cost incurred amounted to P3,000. (Brave Corporation uses Fair value model)
12. At what amount should the non-current assets held for sale be recorded on Oct. 1, 2021?
13. How much impairment loss is to be recorded by Brave relating to the non-current assets held for sale?
14. 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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