A.
B.
C.
D.
Use the following information for the next two (2) questions:
On January 1, 2023, Kobal Company purchased equipment for P1,200,000 with a useful life of 8 years with no
residual value. On December 31, 2024, new technology was introduced that would accelerate the obsolescence
of the equipment. Kobal estimated present value of the expected future net cash flows on the equipment at
P580,000 and the fair value less cost of disposal at P600,000. Kobal determined the recoverable amount of the
equipment on Dec. 31, 2025 at P570,000.
1) What amount of impairment loss should be recognized in 2024?
A
150,000
B.
300,000
C.
330,000
D.
0
.
2) What amount of gain on reversal of impairment loss should be recognized for the year 2025?
A
300,000
B.
250,000
C.
70,000
D.
0
.
1.
Cost
1,200,000
Accumulated depreciation, 12/31/24 (1,200,000 / 8) x 2 years
(300,000)
Carrying amount, 12/31/24
900,000
Recoverable amount (580,000 vs. 600,000) whichever is higher
2.
(600,000)
Impairment loss
300,000
Carrying amount as if no impairment, 12/31/25 (1,200,000 – (150,000 x 3)
750,000
New recoverable amount
570,000
Whichever is lower
570,000
Carrying amount, 12/31/25 {600,000 – [(600,000 / 6) x 1]}
B
(500,000)
Reversal of impairment
70,000
C
Use the following information for the next two (2) questions:
Bernadette, Inc. purchased an equipment on January 1, 2019 for P13,000,000. This equipment had 10-year
useful life. In 2020, due to obsolescence, Bernadette recognized an impairment loss of P2,600,000. On
December 31, 2021, Bernadette determined that the fair value of the equipment had increased to P9,750,000.
1) What amount of gain on reversal of impairment shall Bernadette recognize in 2021?
A
2,925,000
B.
2,275,000
C.
650,000
D.
325,000
.
2) Assuming Bernadette was using revaluation model in accounting for its property, plant and equipment,
how much was the revaluation surplus resulting from the revaluation in 2021?
A
2,250,000
B.
2,275,000
C.
650,000
D.
325,000
.
1.
Cost, 1/1/19
13,000,000
Accumulated depreciation, 12/31/20 (13,000,000 / 10) x 2
(2,600,000)
Carrying amount, 12/31/20
10,400,000
Impairment loss
(2,600,000)
New carrying amount, 12/31/20
7,800,000
Depreciation, 2021 (7,800,000 / 8)
(975,000)
Carrying amount, 12/31/21
6,825,000
Carrying amount “as if no impairment”, 12/31/21 (10,400,000 – 1,300,000)
9,100,000
Reversal of impairment
2.
2,275,000
Carrying amount “as if no impairment”, 12/31/21 (10,400,000 – 1,300,000)
9,100,000
Fair value
9,750,000
Revaluation surplus
650,000
B
C
1) Jin Company purchased a machine on January 2, 2019, for P500,000. The machine has an estimated useful
life of eight years and a salvage value of P50,000. Depreciation was computed by the 200% decliningbalance method. During December 2022, Jin determined that there had been a significant decrease in
market value of its machine. At December 31, 2022, Jin complied the following information regarding the
machine
Expected undiscounted net future cash inflows from the continued use and eventual
160,000
disposal
Expected discounted net future cash inflows from the continued use and eventual disposal
120,000
Fair value less costs of disposal
130,000
What is the impairment loss that should be recognized in 2022 profit or loss?
A
80,938
B.
38,203
C.
28,203
D.
Nil
.
1) An entity acquired a piece of equipment for P7,500,000 on January 1, 2026. The entity depreciated the
asset on a straight-line basis over its useful life of 10 years. On December 31, 2027, the entity identifies an
impairment indicator, and the entity recognizes impairment in accordance with PAS 36 – Impairment of
Assets of P240,000. On February 28, 2029, when the carrying amount of the equipment is P4,920,000, the
machine meets the criteria to be classified as held for sale. The entity estimates the recoverable amount of
the asset immediately before the initial classification as held for sale to be P4,600,000. On June 30, 2029,
when the asset is still held for sale, fair value less cost to sell increases to P5,300,000.How much is the gain
on reversal of impairment loss?
A
700,000
B.
380,000
C.
525,000
D.
-0-
.
2) Autobots Bottling purchased for P800,000 a trademark for a very successful soft drink it markets under the
name OK!, The trademark was determined to have an indefinite life. A competitor recently introduced a
product that is in direct competition with the OK!, thus suggesting the need for an impairment test. Data
gathered by Autobots suggests that the useful life of trademark is still indefinite, but the cash flows
expected to be generated by the trademark have been reduced either to P30,000 per year (with a
probability of 80%) or to P60,000 per year (with 20% probability). The appropriate risk-free interest rate is
10%. The appropriate risk- adjusted interest rate is 5%. The loss on impairment of trademark is
A
.
440,000
B.
320,000
C.
200,000
D.
80,000
1) On December 31, 2021, Cake Company had an equipment with cost of P9,000,000 and accumulated
depreciation of P3,000,000. Due to obsolescence and physical damage, the equipment was found to be
impaired. On same date, the entity determined that the equipment had a fair value less cost of disposal of
P4,500,000, discounted net cash inflows of P4,000,000 and undiscounted net cash inflows of P5,000,000.
What is the impairment loss for 2021?
A
1,500,000
B.
2,000,000
C.
1,00,000
D.
0
.
Use the following for the next three (3) questions:
On January 1, 2021, Yes Sir Company purchased equipment with cost of P10,000,000, useful life of 10 years
and no residual value. The entity used straight line depreciation. On December 31, 2021 and December 31,
2022, the entity determined that impairment indicators are present. There is no change in useful life or residual
value.
December 31, 2021
December 31, 2022
Fair value less cost of disposal
8,100,000
8,300,000
Value in use
8,550,000
8,200,000
2) What is the impairment loss for 2021?
A
900,000
B.
450,000
C.
600,000
D.
0
C.
600,000
D.
0
C.
1,025,000
D.
950,000
.
3) What is the gain on reversal of impairment for 2022?
A
400,000
B.
700,000
.
4) What is the depreciation for 2023?
A
1,000,000
B.
1,050,000
.
Use the following information for the next two (2) questions:
1) Accumulated depreciation at December 31, 2022 and December 31, 2021 were P390,000 and P245,000
respectively. During the year, Polaris Company acquired machineries costing P200,000 to replace the
retired machines costing P120,000. In disposing the retired machines Polaris Company generated cash
inflows of P80,000 recognizing a gain of P15,000. At year end, there was no indication of any impairment
on the machineries of Polaris Company as the carrying amounts of the machinery accounts were less than
the net recoverable amounts of the said item:
In Polaris Company’s 2022 income statement, the amount of depreciation expense reported is
A
100,000
B.
170,000
C.
200,000
.
Use the following information for the next two (2) questions:
D.
290,000
On January 1, 2023, Dreamt Company purchased patent with cost of P11,000,000, useful life of 11 years and no
residual value. On December 31, 2023 and December 31, 2024, Dreamt determined that impairment indicators
are present
December 31,
December 31,
2023
2024
Fair value less cost of disposal
8,100,000
8,300,000
Value in use
8,650,000
8,100,000
1) What is the impairment loss for 2023?
A
1,900,000
B.
1,350,000
C.
2,350,000
D.
0
C.
315,000
D.
0
.
2) What is the gain on reversal of impairment for 2024?
A
1,215,000
B.
515,000
.
2) In which of the following scenarios will an entity record an impairment loss?
Scenario 1
Scenario 3
Carrying amount
10,000
Carrying amount
14,000
Fair value
12,000
Fair value
15,000
13,500
Value in use
9,000
Value in use
Legal fees on selling the asset
1,500
Legal fees on selling the asset
Termination benefits
1,000
Termination benefits
500
Documentary stamp tax
500
Documentary stamp tax
500
Scenario 2
1,000
Scenario 4
Book value
15,000
Book value
14,000
Fair value
12,000
Fair value
15,000
Value in use
10,500
Value in use
13,500
Legal fees on selling the asset
1,500
Legal fees on selling the asset
Termination benefits
1000
Termination benefits
500
Documentary stamp tax
500
Documentary stamp tax
A
1
500
B.
2
C.
3
D.
1,000
4
.
1) On January 1, 2023, Act Company purchased equipment with a cost of P10,440,000, a useful life of 9 years
and no residual value. The entity used straight line depreciation. On December 31, 2023 and December 31,
2024, the entity determined that impairment indicators are present. The following information is available
for impairment testing at each year end:
December 31,
December 31,
2023
2024
Fair value less cost of disposal
8,315,000
7,850,000
Value in use
8,400,000
7,910,000
What is the gain on reversal of impairment for 2024?
A.
880,000
C.
480,000
B.
560,000
D.
770,000
Use the following information for the next five (5) questions:
On December 31, 2019, Human subjected to impairment test a piece of equipment. Data pertinent to the
equipment as of December 31, 2019 follows:
Original cost
2,400,000
Adjusted Accumulated
600,000
depreciation
Selling price
1,400,000
Estimated cost to make the sale
Value in use
200,000
1,100,000
Remaining useful life
Method of depreciation
6 years
Straight line
On December 31, 2021, the asset is found to have a recoverable amount of P1,300,000.
QUESTIONS:Based on the information above and your analysis, answer the following:
1) How much loss impairment is recognized in 2019?
A.
400,000
C.
600,000
B.
500,000
D.
700,000
2) How much is the depreciation expense recognized in 2020?
A.
200,000
C.
300,000
B.
216,667
D.
333,333
3) How much gain on recovery is recognized in 2021?
A.
500,000
C.
300,000
B.
400,000
D.
200,000
4) How much much is the depreciation expense recognized in 2022 under the cost model?
A.
325,000
C.
250,000
B.
300,000
D.
200,000
5) How much is the depreciation expense recognized in 2022 under the revaluation model?
A.
325,000
C.
250,000
B.
300,000
D.
200,000
Use the following information for the next two (2) questions:
Piano owns P2,000,000 of specialized equipment used in the production of video display terminals (VDTs). The
equipment was purchased and installed din January 2010 and has an expected useful life of 20 years and
residual value of P200,000. Piano uses straight-line method of depreciation. In January 2020, one of Piano’s
competitors completed the development of a reduced-radiation VDT. The demand for Piano’s VDTs
immediately declined by 90 percent.
As a result of the change in market conditions, the asset is reviewed for impairment. Piano estimates that
present value of the total remaining future net cash inflows from operating the equipment to be P400,000. The
equipment may be sold at P450,000 after incurring costs of disposal amounting to P75,000. The equipment is
expected to have no residual value and will be used only during the five remaining years that older model
VDTs are manufactured.
6) What is the impairment loss to be recognized on the asset in 2020?
A.
750,000
B.
500,000
C.
250,000
D.
0
75,000
D.
70,000
7) What is the depreciation expense to be recorded in 2020?
A.
90,000
B.
80,000
C.
Use the following information for the next five (5) questions:
On January 1, 2017, RIP Isabel Granada Company purchased a machinery for P600,000, with an estimated
economic useful life of 12 years. Straight line method of depreciation is to be used. On December 31, 2020, it
was properly determined that the fair value less cost of disposal is P235,000, while the value in use is P240,000.
On January 1, 2023, it was properly computed that the recoverable amount of the asset is P250,000.
8) How much is the impairment loss on December 31, 2020?
A.
0
B.
110,000
C.
165,000
D.
160,000
D.
0
9) How much is impairment recovery should be reported on January 1, 2023?
A.
50,000
B.
70,000
C.
120,000
10) Assuming the recoverable value on January 1, 2023 is P330,000, how much is the recovery from
impairment and revaluation surplus, respectively, on January 1, 2023 using the cost model.
Recovery from
Revaluation
Recovery from
Revaluation
impairment
Surplus
impairment
Surplus
A.
120,000
150,000
C.
120,000
30,000
B.
120,000
0
D.
150,000
0
12) Assuming the recoverable value on January 1, 2023 is P330,000, how much is the recovery from
impairment and revaluation surplus, respectively, on January 1, 2023 using the revaluation model?
Recovery from
Revaluation
Recovery from
Revaluation
impairment
Surplus
impairment
Surplus
A.
120,000
150,000
C.
120,000
30,000
B.
120,000
0
D.
150,000
0
14) Blue Company purchased a machine for P650,000 on January 1, 2014. The estimated salvage value of the
machine was P50,000 and Blue estimated that the machine would have a useful life of 10 years, with
depreciation being computed using the straight line method.
In January 2016, the company spent P28,000 for the inspection and overhaul to the machine. This cost was
necessary to meet its original assessed standard of performance. The company also spent P30,000 repairs.
The repairs will not extent the useful life of the machine but will eventually increase the company’s
production. How much is the depreciation expense for the year 2016?
A.
63,750
C.
67,250
B.
70,000
D.
73,500
1) During December 2022, Bombay Company determined that there had been a significant decrease in
market value of its machinery. At December 31, 2022, Bombay presented the following information
concerning the machinery:
Original cost
20,000,000
Accumulated depreciation
12,000,000
Expected undiscounted net future cash inflows from continued use and eventual
7,000,000
disposal
Expected discounted net future cash inflows from continued use and eventual
5,000,000
disposal
Fair value less cost to sell
6,500,000
What is the impairment loss that should be reported in the 2022 income statement?
A
2,000,000
B.
1,500,000
C.
1,000,000
D.
0
.
2) On January 2, 2015, Burmese Company has completed the construction of a building for a total amount of
P10,000,000. The building is to be depreciated on straight line basis over its estimated useful life of 40
years. On January 2, 2015, Burmese converted the building into a commercial establishment with only
minor cost incurred. In consultation with the appraiser, the building’s fair value as of January 2, 2021 was
P11,970,000. In January 1, 2022, due to a sudden change in the economic environment, Burmese is
evaluating possible impairment and determined that the recoverable value of the building was P7,000,000.
The amount of impairment loss, if any, on January 1, 2022 is
A
4,286,000
B.
3,500,000
C.
1,250,000
D.
1,050,000
.
3) Burmilla purchased an equipment on January 1, 2020 at a cost of P10,000,000. This equipment was
depreciated over its useful life of 10 years with a residual value of 10%. On December 31, 2021, Burmilla
determined that the recoverable amount of the equipment was only P5,000,000 with no residual value and
appropriately recognized an impairment loss. However on December 31, 2022, the fair value had increased
to P7,000,000 and the management of Burmilla deemed to reverse impairment that was previously
recorded. What is the gain on impairment to be shown on 2017 income statement?
A
2,500,000
B.
2,625,000
C.
2,925,000
D.
3,000,000
.
4) On January 1, 2016, Havana Brown Company purchased equipment with a cost of P10,440,000, a useful life
of 9 years and no residual value. The entity used straight-line depreciation. On December 31, 2016 and
December 31, 2017, the entity determined that impairment indicators are present. The following
information is available for impairment testing at each year end:
Fair value less cost of disposal
December 31, 2016
December 31, 2017
8,315,000
7,850,000
Value in use
8,400,000
7,910,000
What is the gain on reversal of impairment for 2017?
A
880,000
C.
480,000
560,000
D.
770,000
.
B.
5) On January 1, 2016, Maine Coon Company acquired all the assets and liabilities of another entity. The
acquire has a number of operating division, including one whose industry is the manufacture of toy train.
The toy train division is regarded as a cash generating unit. On December 31, 2017, the carrying amounts
of the assets of the toy train division were:
Building
5,000,000
Inventory
3,000,000
Trademark
1,000,000
Goodwill
1,000,000
There is a declining interest in toy train because of the aggressive marketing of computer-based toys.
Management of Maine Coon Company measured the value in use of the toy train division on December 31,
2017 at P7,200,000. The fair value less cost of disposal of inventory is greater than the carrying amount.
What is the impairment loss to be allocated to the building?
A
2,800,000
C.
1,500,000
1,000,000
D.
2,000,000
.
B.
6) On January 1, 2016, Maine Coon Company acquired all the assets and liabilities of another entity. The
acquire has a number of operating division, including one whose industry is the manufacture of toy train.
The toy train division is regarded as a cash generating unit. On December 31, 2017, the carrying amounts
of the assets of the toy train division were:
Building
2,000,000
Inventory
1,500,000
Trademark
1,000,000
Goodwill
500,000
There is a declining interest in toy train because of the aggressive marketing of computer-based toys.
Management of Maine Coon Company measured the value in use of the toy train division on December 31,
2017 at P3,600,000. What is the impairment loss to be allocated to the building?
A
400,000
C.
900,000
500,000
D.
300,000
.
B.
7) On December 31, 2015, Selkirk Company had an equipment with the following data:
Equipment
10,000,000
Accumulated depreciation
5,000,000
Due to obsolescence and damage, the equipment was found to be impaired. On December 31, 2015, the
fair value less cost of disposal was P4,500,000 and the value in use was P4,000,0000. It was also determined
that the useful life on acquisition date is 20 years and the remaining life of the asset is 10 years on
December 31, 2015. On December 31, 2017 the fair value less cost of disposal of the equipment had risen
to P5,500,000. What amount should be recognized on reversal of impairment in 2017?
A
1,900,000
B.
400,000
C.
500,000
D.
0
.
Use the following information for the next two (2) questions:
Cornish Company finished construction of building on January 1, 2018 at a total cost of P25,000,000. The
building was depreciated over the estimated useful life of 20 years using the straight-line method with no
residual value. The building was subsequently revalued on December 31, 2021 and the revaluation report
showed that the asset had a replacement cost of P32,000,000 and was determined to to have no change in the
useful life. On January 1, 2023, the building was tested for impairment and the fair value was P18,000,000 on
same date, with no change on the remaining useful life.
8) What amount of revaluation surplus should be recognized on December 31, 2021?
A
5,600,000
B.
7,000,000
C.
1,400,000
D.
5,250,000
C.
750,000
D.
0
D.
1,200,000
.
9) What is the impairment loss for 2023?
A
6,000,000
B.
400,000
.
10) What amount of depreciation should be recognized in 2023?
A
1,125,000
B.
1,600,000
C.
1,800,000
.
Use the following information for the next five (5) questions:
On December 31, 2014, Desert King Company subjected to impairment test a piece of equipment. Data
pertinent to the equipment as of December 31, 2014 follow:
Original cost
Adjusted accumulated depreciation
Selling price
Cost to sell
Value in use
Remaining useful life
Method of depreciation
2,400,000
600,000
1,400,000
200,000
1,100,000
6 years
Straightline
On December 31, 2016, the asset is found to have a recoverable amount of P1,300,000.
11) How much loss on impairment is recognized in 2014?
A
400,000
C.
600,000
500,000
D.
700,000
.
B.
12) How much is the depreciation expense recognized in 2015?
A
200,000
C.
300,000
216,667
D.
333,333
.
B.
13) How much is gain on recovery is recognized in 2016?
A
500,000
C.
300,000
400,000
D.
200,000
.
B.
14) How much is the depreciation expense recognized in 2017 under the cost model?
A
325,000
C.
250,000
300,000
D.
200,000
.
B.
15) How much is the depreciation expense recognized in 2017 under the revaluation model?
A
325,000
C.
250,000
300,000
D.
200,000
.
B.
Use the following information for the next three (3) questions:
Coachwhip Corporation purchased a machinery on January 1, 2022 for P5,000,000. The same had an expected
useful life of 8 years. Straight line depreciation method is in place for similar items. On January 1, 2024, the
asset is appraised as having a sound value of P4,500,000. On January 1, 2027, the asset had a recoverable value
of P1,375,000.
16) How much is credited to the revaluation surplus as a result of the revaluation in 2024?
A
1,500,000
B.
1,250,000
C.
1,000,000
D.
750,000
D.
1,500,000
D.
0
.
17) What is the correct depreciation to be recognized in 2024?
A
750,000
B.
1,000,000
C.
1,250,000
.
18) How much is the loss on impairment should be recognized on January 1, 2027?
A
.
750,000
B.
500,000
C.
250,000
19) On January 1, 2016, Hognose Company purchased a patent at a cost P1,880,000 and a useful life of 4 years.
At December 31, 2016 and December 31, 2017, the entity determined that impairment indicators were
present. The entity provided the following information for impairment testing at year end:
December 31, 2016
December 31, 2017
Fair value less cost of disposal
1,430,000
840,000
Value in use
1,500,000
890,000
No changes were made in the asset’s remaining life. What should be reported in the 2017 income
statement?
A. Amortization expense P470,000
B. Amortization expense P470,000 and impairment loss P50,000
C. Amortization expense P470,000 and gain on reversal on impairment P90,000
D. Impairment loss P50,000
20) Presented below is information related to equipment owned by King Cobra Company:
Cost
9,000,000
Accumulated depreciation
1,500,000
Fair value less cost to sell
3,200,000
King Cobra Company will continue to use the asset for its remaining 5 year life, at the end of which it is
expected to be sold at P500,000. Expected cash inflows from the use of the asset is P1,500,000, after
incurring production costs including annual maintenance of P700,000. The appropriate discount rate is
10%. The present value:
Single payment of 1 at 10% for 5 periods
0.6209
Ordinary annuity of 1 at 10% for 5 periods
3.7908
How much is the impairment loss?
A
4,156,910
B.
3,343,090
C.
568,618
D.
3,032,640
.
21) On January 1, 2017, Black Widow acquired the following intangible assets:
 A trademark for P2,000,000. The trademark has 8 years remaining in its legal life. It is anticipated that
the trademark will be renewed in the future, indefinitely, without a problem.
 A patent for P4,000,000. Because of market conditions, it is expected that the patent will have
economic life for just 5 years, although the remaining legal life is 10 years.
On December 31, 2017, the intangible assets are assessed for impairment. Because of the decline in the
economy, the trademark is expected to generate cash flows of just P120,000 per year. The useful life of the
trademark still extends beyond the foreseeable horizon. The cash flows expected to be generated by the
patent are P500,000 annually for each of the next 4 years. The appropriate discount rate for all intangible
assets is 8%. The present value of ordinary annuity of 1 at 8% for four periods is 3.31. What total amount to
be recognized as impairment loss in 2017?
A
2,045,000
C.
2,845,000
1,545,000
D.
1,980,000
.
B.
Use the following information for the next four (4) questions:
Malphai Corporation purchased a machinery on January 1, 2015, at a cost of P1,000,000. It is being
depreciated using the straight-line method over its projected useful life of 10 years. At December 31, 2016, the
asset’s fair value was P1,200,000. Accordingly, an entry was made on that date to recognized the revaluation
write up.
A revaluation was made again on December 31, 2018 wherein the sound value of the asset was determined to
be P570,000. The company has the policy of transferring any revaluation surplus to retained earnings as the
asset is being used up.
22) How much is the revaluation surplus on December 31, 2016?
A
500,000
C.
1,200,000
400,000
D.
0
.
B.
23) How much is the depreciation expense for the year 2017?
A
150,000
C.
187,500
100,000
D.
80,000
.
B.
24) How much is the impairment loss for the year 2018?
A
330,000
C.
30,000
70,000
D.
0
.
B.
25) How much is the carrying amount of the machinery on December 31, 2019?
A
95,000
C.
620,000
475,000
D.
380,000
.
B.
Use the following information for the next three (3) questions:
On January 1, 2014, Barbed Company purchased an equipment for P900,000, with an estimated useful life of 8
years. Straight-line method of depreciation is to be used with no salvage value. On January 1, 2017, the
equipment was tested for impairment. The estimated selling price of the equipment is P550,000 and the
estimated cost to sell is P30,000. The asset is expected to provide annual net cash inflows of P145,000 during
the remaining useful life of the equipment and estimated a residual value of P35,000 at the end of its useful
life. The appropriate pre-tax discount rate that reflects current market assessments of the time value of money
is 12%.
26) How much is the recoverable value of the equipment on January 1, 2017?
A
520,000
C.
550,000
.
B.
542,570
D.
562,500
27) How much is the impairment loss to be recognized on January 1, 2017?
A
12,500
C.
19,930
42,500
D.
0
.
B.
28) How much is the depreciation expense for the year 2017?
A
108,514
C.
103,000
101,514
D.
112,500
.
B.
Use the following information for the next three (3) questions:
On January 1, 2012, Barrier Idol Company purchased a machinery for P600,000, with an estimated economic
useful life of 12 years. Straight line method of depreciation is to be used. On December 31, 2015, it was
property determined that the fair value less cost of disposal is P235,000 while the value in use is P240,000. On
January 1, 2018, it was properly computed that the recoverable amount of the asset is P250,000.
29) How much is the impairment loss on December 31, 2015?
A
160,000
C.
110,000
165,000
D.
0
.
B.
30) How much is the maximum recoverable amount/limit on recovery on January 1, 2018?
A
120,000
C.
180,000
70,000
D.
250,000
.
B.
31) How much impairment recovery should be reported on January 1, 2018?
A
50,000
C.
120,000
70,000
D.
0
.
B.
32) Assuming the recoverable value on January 1, 2018 is P330,000, how much is the recovery from
impairment and revaluation surplus, respectively, on January 1, 2018 using cost model?
Recovery of impairment loss
Revaluation surplus
A.
120,000
150,000
B.
120,000
0
C.
120,000
30,000
D.
150,000
0
33) Assuming the recoverable value on January 1, 2018 is P330,000, how much is the recovery from
impairment and revaluation surplus, respectively, on January 1, 2018 using revaluation model?
Recovery of impairment loss
Revaluation surplus
A.
120,000
150,000
B.
120,000
0
C.
120,000
30,000
D.
150,000
0
Use the following information for the next two (2) questions:
Bloodborne Company has determined that one of its cash generating units (CGU) is impaired. The assets of
the cash generating unit at carrying amount are:
Machinery
1,500,000
Building
3,000,000
Equipment
1,875,000
Furniture and fixture
1,125,000
Goodwill
800,000
The recoverable value of the cash generating units is P7,000,000. The fair value less cost of disposal of the
equipment is P1,825,000.
34) How much impairment loss that should be allocated to equipment?
A
50,000
C.
75,000
125,000
D.
0
.
B.
35) How much is the carrying amount of the building after allocation of the impairment loss?
A
2,760,000
C.
2,770,000
2,800,000
D.
2,069,000
.
B.