Dept of Agriculture determines an indication that its investment property purchased on Jan 1 2005 might be impaired starting Jan. 1. 2008. The entity gathers the fol

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Dept. of Agriculture determines an indication that its investment property purchased on Jan.1 2005 might be impaired starting Jan. 1, 2008. The entity gathers the following
information:
Carrying amount of investment property
P1,200,000
Fair value less cost to sel
990,000
Value in Use
800,000
Residual value
5%
Following the impairment, DA revises its remaining useful life to 12 years. Compute for the following:
Six years after the impairment, D.A. determines an indication that the impairment may no longer exist. The investment property would have a carrying amount of P650,000 by now.
Compute for the following:
c) Carrying amount as of Dec 31, 2013
d) Gain on the reversal of the impairment
Transcribed Image Text:Dept. of Agriculture determines an indication that its investment property purchased on Jan.1 2005 might be impaired starting Jan. 1, 2008. The entity gathers the following information: Carrying amount of investment property P1,200,000 Fair value less cost to sel 990,000 Value in Use 800,000 Residual value 5% Following the impairment, DA revises its remaining useful life to 12 years. Compute for the following: Six years after the impairment, D.A. determines an indication that the impairment may no longer exist. The investment property would have a carrying amount of P650,000 by now. Compute for the following: c) Carrying amount as of Dec 31, 2013 d) Gain on the reversal of the impairment
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