Prepare the necessary adjusting entries for the following independent transactions: 1. Alps Co. acquired land, building, and equipment from Bankrupt Inc. for P2,800,000. Bankrupt’s assets on acquisition date had the following values: Book Value Fair Value Land P 800,000 P 600,000 Building 1,000,000 1,400,000 Equipment 1,200,000 1,200,000 Alps decided to take a conservative position by recording the lower of the two values for each PPE item acquired. The following entry was made: Land 600,000 Building 1,000,000 Equipment 1,200,000 Cash 2,800,000

Prepare the necessary adjusting entries for the following independent transactions: 1. Alps Co. acquired land, building, and equipment from Bankrupt Inc. for P2,800,000. Bankrupt’s assets on acquisition date had the following values: Book Value Fair Value Land P 800,000 P 600,000 Building 1,000,000 1,400,000 Equipment 1,200,000 1,200,000 Alps decided to take a conservative position by recording the lower of the two values for each PPE item acquired. The following entry was made: Land 600,000 Building 1,000,000 Equipment 1,200,000 Cash 2,800,000

SWFT Essntl Tax Individ/Bus Entities 2020

23rd Edition

ISBN:9780357391266

Author:Nellen

Publisher:Nellen

Chapter7: Property Transactions: Basis, Gain And Loss, And Nontaxable Exchanges

Section: Chapter Questions

Problem 32P

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