In May 2021, Cherry Company relocated an employee from the Manila head office to a branch in Zamboanga City. At the end of the reporting period on June 30, 2021, the costs are estimated at P350,000 analyzed as follows: Cost for shipping goods P 30,000 Airfare 10,000 Temporary accommodation cost for July and August 80,000 Temporary accommodation cost for May and June 90,000 Reimbursement for lease break cost paid in July (lease was terminated in May) 20,000 Reimbursement for cost of living increases for the period May 1, 2021 to May 1, 2022 120,000 1. What amount should be recognized as provision for relocation costs on June 30, 2021?
In May 2021, Cherry Company relocated an employee from the Manila head office to a branch in Zamboanga City. At the end of the reporting period on June 30, 2021, the costs are estimated at P350,000 analyzed as follows: Cost for shipping goods P 30,000 Airfare 10,000 Temporary accommodation cost for July and August 80,000 Temporary accommodation cost for May and June 90,000 Reimbursement for lease break cost paid in July (lease was terminated in May) 20,000 Reimbursement for cost of living increases for the period May 1, 2021 to May 1, 2022 120,000 1. What amount should be recognized as provision for relocation costs on June 30, 2021?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Question
In May 2021, Cherry Company relocated an employee from the Manila head office to a branch in Zamboanga City. At the end of the reporting period on June 30, 2021, the costs are estimated at P350,000 analyzed as follows:
Cost for shipping goods P 30,000
Airfare 10,000
Temporary accommodation cost for July and August 80,000
Temporary accommodation cost for May and June 90,000
Reimbursement for lease break cost paid in July
(lease was terminated in May) 20,000
Reimbursement for cost of living increases for the
period May 1, 2021 to May 1, 2022 120,000
Cost for shipping goods P 30,000
Airfare 10,000
Temporary accommodation cost for July and August 80,000
Temporary accommodation cost for May and June 90,000
Reimbursement for lease break cost paid in July
(lease was terminated in May) 20,000
Reimbursement for cost of living increases for the
period May 1, 2021 to May 1, 2022 120,000
1. What amount should be recognized as provision for relocation costs on June 30, 2021?
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