Wednesday Company purchased equipment for P8,000,000 on January 1, 2023 with a useful life of 10 years and no residual value. on December 31, 2024, Wednesday classified the equipment as held for sale. The fair value of the equipment on December 31, 2024 was P6,000,000 and the cost of disposal P200,000. On December 31, 2025, Wednesday believed that the criteria for classification as held for sale can no longer be met. On such date, the fair value of the equipment was P5,000,000 and the cost of disposal was P100,000. The value in use was determined to be P5,500,000. Accordingly, the entity decided not to sell the asset but to continue to use it. What is the impairment loss to be recognized on December 31, 2024?
Wednesday Company purchased equipment for P8,000,000 on January 1, 2023 with a useful life of 10 years and no residual value. on December 31, 2024, Wednesday classified the equipment as held for sale. The fair value of the equipment on December 31, 2024 was P6,000,000 and the cost of disposal P200,000.
On December 31, 2025, Wednesday believed that the criteria for classification as held for sale can no longer be met. On such date, the fair value of the equipment was P5,000,000 and the cost of disposal was P100,000. The value in use was determined to be P5,500,000. Accordingly, the entity decided not to sell the asset but to continue to use it.
What is the impairment loss to be recognized on December 31, 2024?
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