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epare all indicated journal entries for 2020 and 2021.

epare all indicated journal entries for 2020 and 2021.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Problem 30-4 (AICPA Adapted) Cognac Company reported an impairment loss of P2,000,000 in the income statement for the year ended December 31, 2020. This loss was related to long-lived asset acquired on January 1. 2019 with cost of P10,000,000, useful life of 10 years and no residual value. On December 31, 2020, the entity reported the long-lived asset at P6,000,000 which is the fair value less cost of disposal on such date. On December 31, 2021, the entity determined that the fair value less cost of disposal of the impaired long-lived asset had increased to P7,500,000. The straight line depreciation is recorded for the impaired asset. Required: Prepare all indicated journal entries for 2020 and 2021. Prohlem 30-5 (LA0)
Transcribed Image Text:Problem 30-4 (AICPA Adapted) Cognac Company reported an impairment loss of P2,000,000 in the income statement for the year ended December 31, 2020. This loss was related to long-lived asset acquired on January 1. 2019 with cost of P10,000,000, useful life of 10 years and no residual value. On December 31, 2020, the entity reported the long-lived asset at P6,000,000 which is the fair value less cost of disposal on such date. On December 31, 2021, the entity determined that the fair value less cost of disposal of the impaired long-lived asset had increased to P7,500,000. The straight line depreciation is recorded for the impaired asset. Required: Prepare all indicated journal entries for 2020 and 2021. Prohlem 30-5 (LA0)
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