Erica Company had the following property acquisitions during the current year: 1. Acquired a tract of land in exchange for 50,000 ordinary shares with P100 par value and market price of P120 share on the date of acquisition. per The last property tax bill indicated assessed value of P4,500,000 for the land. 2. Received land from a major shareholder as an inducement to locate a plant in the city. No payment was required but the entity paid P50,000 for legal expenses for land transfer. The land is fairly valued at P1,000,000. 3. Purchased for P5,500,000, including appraiser fee of P100,000´a warehouse building and the land on which it is located. The land had an appraised value of P2,000,000 and original cost of P1,400,000. The building had an appraised value of P3,000,000 and original cost of P2,500,000.

Erica Company had the following property acquisitions during the current year: 1. Acquired a tract of land in exchange for 50,000 ordinary shares with P100 par value and market price of P120 share on the date of acquisition. per The last property tax bill indicated assessed value of P4,500,000 for the land. 2. Received land from a major shareholder as an inducement to locate a plant in the city. No payment was required but the entity paid P50,000 for legal expenses for land transfer. The land is fairly valued at P1,000,000. 3. Purchased for P5,500,000, including appraiser fee of P100,000´a warehouse building and the land on which it is located. The land had an appraised value of P2,000,000 and original cost of P1,400,000. The building had an appraised value of P3,000,000 and original cost of P2,500,000.

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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