On December 31, 2020, the entity classified as held for sale a machine with carrying amount of P6,000,000. On this date, the machine is expected to be sold for P5,520,000. Disposal cost is expected at P240,000. On December 31, 2021, the machine had not been sold and management after considering its options decided to place back the machine into operations. On this date, the entity estimated that the machine is expected to be sold at P5,160,000 with the disposal cost at P60,000. The carrying amount of the machine was P4,800,000 on December 31, 2021 if the noncurrent asset was not classified as held for sale. Required: Compute the impairment loss for 2020.
On December 31, 2020, the entity classified as held for sale a machine with carrying amount of P6,000,000. On this date, the machine is expected to be sold for P5,520,000. Disposal cost is expected at P240,000. On December 31, 2021, the machine had not been sold and management after considering its options decided to place back the machine into operations. On this date, the entity estimated that the machine is expected to be sold at P5,160,000 with the disposal cost at P60,000. The carrying amount of the machine was P4,800,000 on December 31, 2021 if the noncurrent asset was not classified as held for sale. Required: Compute the impairment loss for 2020.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
On December 31, 2020, the entity classified as held for sale a machine with carrying amount of P6,000,000. On this date, the machine is expected to be sold for P5,520,000. Disposal cost is expected at P240,000.
On December 31, 2021, the machine had not been sold and management after considering its options decided to place back the machine into operations. On this date, the entity estimated that the machine is expected to be sold at P5,160,000 with the disposal cost at P60,000.
The carrying amount of the machine was P4,800,000 on December 31, 2021 if the noncurrent asset was not classified as held for sale.
Required: Compute the impairment loss for 2020.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education