ACCOUNTING FOR INVESTMENT PROPERTY.PROBLEM 1. PLEASE ANSWER AND SHOW SOLUTION Darell Co.'s diverse activities.how to classify the following items in the statement of financial position duc toDarell Company. Darell Co.'s accountant, the hot and sexy Ms. Munda, is unsureThe following data was extracted during the financial statement preparation ofPROBLEMviuJsiJICUtion IssuesDarell Co.'s diverse activitiesItem1)Factory which due to a decline in activity is no longerrequired and is now being held for sale in accordanceAmountP 500,000with PFRS 5.2)Farming land was purchased for its investmentpotential. Planning permission has not been obtained800,000for building constructions of any kind.| 3)A factory is in the process of being constructed onbehalf of the government.1,260,0004)A building being constructed on behalf of MarkyCompany1,000,0005)A new office building used by one of its subsidiaries asits head office which was purchased specifically in the1,200,000center of Makati City in order to exploit its capital gainspotential.A property that is in the process of construction for6)sale950,000A property intended for sale in the ordinary course of7)business450,0008) | Owner-occupied properties1,600,000760,0009)Buildings occupied by employees, including Ms. Mundathe accountant. The employees pays rent on thebuilding they occupied10) |A building occupied by employees, the employees donot pay market rent on the building they occupied.11) | A building that is leased to a third party under afinance lease240,0001,110,00012) | A building that is held under mixed use; half of it isowner-occupied and the other half is to earn rentals13)1,720,00013) | A property wherein significant ancillary services areprovided to occupants14) Land and building leased to a subsidiary15) | A building leased to an associate under an operatinglease16)960,0002,100,0001,620,000530,000A new machine leased to another associate under anoperating lease4 machine that is leased by the. company under420,000 18) A building that is being constructed for future use asadministration building.870,000Questions:Based on the above and the result of your audit, determine the amounts to bereported in the consolidated financial statement of Darell Company and itssubsidiaries:Investment property3. Inventoriesc. P1,400,000d. P500,000а.P1,900,000b.P950,000

PPE includes all tangible assets that are held for more than 1 year and used in the administration…

The following data was extracted during the financial statement prcparation of tion Issues Darell Company. Darell Co's accountant, the hot and sexy Ms. Munda, is unsure PRO classify the following items in the statement of financial position due to how to parell Co.'s diverse activities. Item 1) Factory which due to a decline in activity is no longer required and is now being held for sale in accordance Amount P 500,000 with PFRS 5. Farming land was purchased for its investment 2) potential. Planning permission has not been obtained for building constructions of any kind. A factory is in the process of being constructed on 800,000 3) behalf of the government. A building being constructed on behalf of Marky 1,260,000 4) Company A new office building used by one of its subsidiaries as 1,000,000 5) its head office which was purchased specifically in the center of Makati City in order to exploit its capital gains _potential. A property that is in the process of construction for 1,200,000 6) sale A property intended for sale in the ordinary course of 950,000 7) business Owner-occupied properties 450,000 3). Buildings occupied by employees, including Ms. Munda the accountant. The employees pays rent on the building they occupied 0)A building occupied by employees, the employees do not pay market rent on the building they occupied. 1) A building that is leased to a third party under a finance lease 2 A building that is held under mixed use; half of it is Owner-occupied and the other half is to earn rentals JA property wherein significant ancillary services are provided to occupants Land and building leased to a subsidiary A building leased to an associate under an operating lease 1,600,000 760,000 240,000 1,110,000 1,720,000 960,000 2,100,000 1,620,000 A new machine leased to another associate under an operating lease 530,000 maching ihat io loncod bu the comnany, under 420,000

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q