Legend Dairy produced milk for local ice cream producers,The entity began operations at the beginning of current yearProblem 13-4 (IAA)Legend Dairy produced milk for local ice creamThe entity began operations at the beginning of current veby purchasing milking cows for P2,000,000.The entity provided the following information at year-enarelating to the milking cows:2,000,000Carrying amount-beginningChange in fair value due to growth and price changeDecrease in fair value due to harvestNewborn calf at year-end at fair valueMilk harvested during the year but not yet sold400,00050,000200,000250,0001. What amount of net gain on biological asset should bereported in the current year?a. 400,000b. 350,000c. 800,000d. 550,0002. What amount of gain on agricultural produce should bereported in the current year?a. 250,000b. 200,000c. 600,000d. 650,0003. What is the carrying amount of the biological asset atyear-end?a. 2,000,000b. 2,400,000e. 2,550,000d. 2,800,000

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What amount of net gain on biological asset should be reported in the current year?

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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Question

Legend Dairy produced milk for local ice cream producers,
The entity began operations at the beginning of current year
Problem 13-4 (IAA)
Legend Dairy produced milk for local ice cream
The entity began operations at the beginning of current ve
by purchasing milking cows for P2,000,000.
The entity provided the following information at year-ena
relating to the milking cows:
2,000,000
Carrying amount-beginning
Change in fair value due to growth and price change
Decrease in fair value due to harvest
Newborn calf at year-end at fair value
Milk harvested during the year but not yet sold
400,000
50,000
200,000
250,000
1. What amount of net gain on biological asset should be
reported in the current year?
a. 400,000
b. 350,000
c. 800,000
d. 550,000
2. What amount of gain on agricultural produce should be
reported in the current year?
a. 250,000
b. 200,000
c. 600,000
d. 650,000
3. What is the carrying amount of the biological asset at
year-end?
a. 2,000,000
b. 2,400,000
e. 2,550,000
d. 2,800,000

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