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Merida company acquired an item of property, plant and equipment at a cost of P1,000,000 on January 2, 2017. The asset's estimated residual value is P100,000 and estimated useful life of 10 years. The company uses straight-line of depreciation. On January 1, 2022, the asset was reclassified as "held for sale". Its fair value on this date was P600,000 and the cost to sell was estimated at P20,000. At what amount should the asset "held for sale" be recorded at January 1, 2022

Merida company acquired an item of property, plant and equipment at a cost of P1,000,000 on January 2, 2017. The asset's estimated residual value is P100,000 and estimated useful life of 10 years. The company uses straight-line of depreciation. On January 1, 2022, the asset was reclassified as "held for sale". Its fair value on this date was P600,000 and the cost to sell was estimated at P20,000. At what amount should the asset "held for sale" be recorded at January 1, 2022

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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Merida company acquired an item of property, plant and equipment at a cost of P1,000,000 on January 2, 2017. The asset's estimated residual value is P100,000 and estimated useful life of 10 years. The company uses straight-line of depreciation. On January 1, 2022, the asset was reclassified as "held for sale". Its fair value on this date was P600,000 and the cost to sell was estimated at P20,000. At what amount should the asset "held for sale" be recorded at January 1, 2022
Transcribed Image Text:Merida company acquired an item of property, plant and equipment at a cost of P1,000,000 on January 2, 2017. The asset's estimated residual value is P100,000 and estimated useful life of 10 years. The company uses straight-line of depreciation. On January 1, 2022, the asset was reclassified as "held for sale". Its fair value on this date was P600,000 and the cost to sell was estimated at P20,000. At what amount should the asset "held for sale" be recorded at January 1, 2022
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