On December 31, 2026, MATAPAT Company classified as held for sale an equipment with a carrying amount of P5,000,000. On this date, the equipment is expected to be sold for P4,600,000. Reasonable disposal cost to be incurred on sale is expected at P200,000. By December 31, 2027, the equipment had not been sold and management decided to place back the equipment to operations. On same date, the entity estimated that the equipment is expected to be sold at P4,300,000 with disposal cost of P50,000. The carrying amount of the equipment is P4,000,000 on December 31, 2027 if the noncurrent asset is not classified as held for sale. What is the impairment loss in 2026? and What amount should be recognized in profit or loss as a result of reclassification in 2027?
On December 31, 2026, MATAPAT Company classified as held for sale an equipment with a carrying amount of P5,000,000. On this date, the equipment is expected to be sold for P4,600,000. Reasonable disposal cost to be incurred on sale is expected at P200,000. By December 31, 2027, the equipment had not been sold and management decided to place back the equipment to operations. On same date, the entity estimated that the equipment is expected to be sold at P4,300,000 with disposal cost of P50,000. The carrying amount of the equipment is P4,000,000 on December 31, 2027 if the noncurrent asset is not classified as held for sale. What is the impairment loss in 2026? and What amount should be recognized in profit or loss as a result of reclassification in 2027?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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On December 31, 2026, MATAPAT Company classified as held for sale an equipment with a carrying amount of P5,000,000. On this date, the equipment is expected to be sold for P4,600,000. Reasonable disposal cost to be incurred on sale is expected at P200,000.
By December 31, 2027, the equipment had not been sold and management decided to place back the equipment to operations. On same date, the entity estimated that the equipment is expected to be sold at P4,300,000 with disposal cost of P50,000.
The carrying amount of the equipment is P4,000,000 on December 31, 2027 if the noncurrent asset is not classified as held for sale.
- What is the impairment loss in 2026? and What amount should be recognized in profit or loss as a result of reclassification in 2027?
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