/ Entity A acquires 5 motor vehicles for a package price of P10M, In conjunction with the purchase, the supplier provides Entity A a promotional item of 1 motor vehicle which is the same as those acquired. The fair value the motor vehicle is P2M. Which of the following statements is correct? a. For individual costing purposes, the cost of each motor vehicle acquired is P2,000,000. b. For individual costing purposes, the cost of each motor vehicle acquired is P1,666,667. C. The promotional item is recognized as gain equal to fair value. d. b and c
/ Entity A acquires 5 motor vehicles for a package price of P10M, In conjunction with the purchase, the supplier provides Entity A a promotional item of 1 motor vehicle which is the same as those acquired. The fair value the motor vehicle is P2M. Which of the following statements is correct? a. For individual costing purposes, the cost of each motor vehicle acquired is P2,000,000. b. For individual costing purposes, the cost of each motor vehicle acquired is P1,666,667. C. The promotional item is recognized as gain equal to fair value. d. b and c
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Property, Plant and Equipment
contract to a contractor. The initial cost of the building will
apter 10
Plant and Equipment
Property,
287
Entity A acquires 5 motor vehicles for a package price of
P10M, In conjunction with the purchase, the supplier provides
Entity A a promotional item of 1 motor vehicle which is the
same as those acquired. The fair value the motor vehicle is
P2M. Which of the following statements is correct?
a. For individual costing purposes, the cost of each motor
vehicle acquired is P2,000,000.
b. For individual costing purposes, the cost of each motor
vehicle acquired is P1,666,667.
C. The promotional item is recognized as gain equal to fair
value.
d. band c
stics of
f goods
S, or for
eporting
Qurse of
mition of
Ehnty A acquires a building by awarding a construction
Contract to a contractor The initial cost of the building wih
most likely ho
Transcribed Image Text:gene
during testing
C.
7. Entity A acquires a buil
Employee benefits arising directly from the acquisition of
PPE
set is ide
Entity A acquires 5 motor vehicles for a package price of
6.
P10M. In conjunction with the purchase, the supplier provides
the pen
dassfied
Entity A a promotional item of 1 motor vehicle which is not of
the same type as those acquired. The fair value the motor
vehicle is P2M. Which of the following statements is correct?
a. For individual costing purposes, the cost of each of the 5
motor vehicles is P1,600,000.
25.00
b. For individual costing purposes, the cost of each motor
vehicle acquired is P1,666,667. o
C. The promotional item is recognized as gain equal to fair
value.
taken on
d. a and c
through self-construc
The initial cost
Entity A acquires a buil
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