PROBLEM 1

hase rand (ss"so,ooo)

Propeny iaxe. (1,3oo,oooi2.2sl3)

________1!9499r

cored 63t oa the rrurldhs

hase rand (e5*so,ooo)

P.rvalue of sharer issued __-14!!9L
share premjum, per books
Nd adiustment {debit)

PROBLEM 2

INWNTORY/FIXTURES
 Depreaiation expense 2012:
Equipment I,259
guilding 26,000
Display fixtures 4,977
Machinery 4,000
Total 44,77O

Land 48,000

Depreciable f ixed assets:

Equipment 92,593
Accumulated depreciataon 18,s19 74,O74
Building 650,000
Accumulated depreciation 52,000 598,000
Dispiay fixtures 49,1O7
Accumulated depreciation 4,9LL 44,196
Mahinery 40,000
Accumulated depreciation 8,000 32,ooo
Total 748,277

PROBLEM 3

Carrying value, 12.31.11-Asset A 36,000

DDB % 40v.
Depreciation expense 2012 t4,4OO

55,000
Salvage value 10,000
Depreiable amount 45,000
Fraction 2012 2/Is
Depreciation expense 2012 6,000

3 Cost-Asset C 70,ooo
Accumulated dep.eciation 33,600
Book value 36,400
Selling price 2a,ooo
Loss on sale
PROBLEM 4

1. Cost ofTruck P 500,000

Multiplied by: remaining useful yrs. Over total life 3/10
CV beg.,2012 P 150,000
Cost to overhaul the tilck 125.000
Total cost P 21s,000
Divided by: total remaining yrs.
Depreciation expensq 2012 L_- i4.J8
2. Balance ofacc. depreciation before improvement P 350,000
Deprcciation expense, 20 I 2 34,3'75
Cost to overhaul the truck (improvement in life) ( 125.000)
Accumulated Depreciation, Dec. 31, 2012 P 259,37!
PROBLEM 5

t. &2.
Appraised value
Land P 900,000 (900,000/9,000,000) x 8,200,000 P 820,000
Building 9- 100.000 (8,100,000/9,000,000) x8,200,000 7" 380. 000
Tr,tal PlL.r000--0(x) PL200-0aa

3. Cost ofBuilding A P 7,380,000

Less: Salvage value 400. 000
Depreciable cost P 6, 980, 000
Divided by: depreciation expense I 74. 500
Estimated life --------40Jns.
4. Depreciable cost P 6, 980, 000
Divided by: Estimated life in years 40
Depreciation expeDsq 2012 P,itzlioo
5 FV ofLard B P 750, 000
Cost of Demolition of existing building 160- 000
Cost ofland B P S10- O00

6. Depreciation for Building B (under coNtruction) PO

7. Cost of Donated equipnent (Fair market valu) _E_l00lxl0
8. Cost P. 300,000
Less: Accumulated depreciation
Cost P 300,000
Multiplied by: Depreciation rale (1.5/10) 15% 45.000
Carrying value, Sept. 30, 201 I P 255,000
Multiplied y: Depreciation rate l5o/o
Depreciatiol expense, Sept. 30, 2012 P 18.250
 I Total cost ofmachine A P 1, 649, 000
kss:K&M 149.000
Correct cost P 1,500,000
Irss: salvage value
Depreciable cost P r,440,000
Multiplied by: SYD 2012 /16
'7

Depreciation expense, 2009 P 280,000

Multiplied by: mos. of dp rcclation l2l30l1 1 - 02/01/012 4/12
Depreciatioe expense, Feb. 01, 2012 E ,__93J33

PROBLEM 6

Case 4
Carrying value P r80,000
Less: Value in use
Impairment loss E. .jlLaQA
Case 5
Carying value P 210,000
l,ess: FIVIV less cost to sell i95. 000
lmpairmetr{ loss P 1s.000

PROBLEM 7

l. Original aggegate cost P 609,000

Less: Accumulsled depre.iation for i ) rs.
[(P609,00C-49,000) x3l8] 210.000
CV before impairment test, Dec.31' 2007 P -39L00!)

2.

cosT
YEARS REVENUES EXCT DEP NET VALI.JE

2008 225,OO0 84,000 141,000.00 0.9091 128,143

2009 240,000 126,000 114000.c0 0.8264 94,210
2070 195,000 165,000 30,000.00 0.7513 22,539
2071 130,000 115,000 15,000.00 0.6830 10,245
20!2 80,000 70,000 10,000.00 0.6209 6,209
2072 49.000 49,000.00 0.6209 30,424
TOTAL VAI.UE IN USE 291,ALO

3. Eigher between value in use and FV less cost to sell

(RE( OVERABLE AMOT]N'|-) L;191,t101
Value in use P 291,810'r'
Net selling price 253,500
 4. Carrying value, Dec.31,2007 P 399,000
Less: RECOVERABLE AMOUNT 291.810
Impairment loss P t0zl90
5. Higher bet. Value in use and FV less cost to sell
(RNCOVERABLE AMOUNT) -P___30i,_0001

Value in use P 291,810

Net selling price 300,000+

6. Carrying value, Dec.31,2007 P 399,000

Less: RXCOVERABLE AMOIJNT 300.00!
Impairment Ioss P 9q- 000

PROBLEM 8

1. Carq/ing value ofequipment P 1, 800, 000

(P2,400,000 - 600,000)
Loss: Higher bet. FV less cost to sell and value in use
FV less cost to sell (P 1,400,000 200,000) P 1, 200, 000
Value in use 1. 100- 000 1.200.000
Impairment loss 2009 L__600JX10

2. Carrying value ofequipmetrt, 2010 P 1,200.000

Divided by: remaining useful life 6lrs.
Depreciation expeme, 2010 -P___z)luloc
3. Recoverable amount (to extent ofCV 2009 as ifthere is no impairment) P 1, 800, 000
Accumulated depreciation 2010 201 1 (P],800,000 x216) ( 600.000)
Carying value as of20l I P 1,200,0c0
Less: CV as ifthere is an impairment
CV as of2009 P 1, 200, 000
Less: Acc. Depreciation 2010-11
(P1,200,000 x 2/6) 400. 000 800.000
Gaitr in recoYery 2011 P rl0(Li00
4. Carying value as of20l l P 1,200,000
Divided by: remaining usetul life 4 rm.
Depreciation expeBe in 2012 (cost model) P___30tLlD0

5. Recoverable amount, 20ll P 1,300,000

Divided by: remaiaiag useful life 4 \,ars.
Depreciation expense in 2012 (revaluatio[ model) P*i!25J)0t)
PROBLEM 9

1. Cost ofland P 6, 600, 000

Proceeds ( 4.008.000)
Loss on disposal oflaad f2.5 t}()0
 Gain or loss on disposal ofBuilding f_0
3. Paoceeds P 8, 880, 000
kss: Carrying value
Cost ofwarehouse P 8, 400, 000
Accumulated Depreciation ( l. 320" 000) 7.080.000
Gain on Disposal ofWarehouse P t- *00- o00

4. Fair Value (RECEIVED) P 756,000

I-ess: Carrying value:
Cost of Machine P 960,000
Accumuiated Depreciation 384. 000 576.000
Gain on Disposal ofMachine _P_18!-_Om

5. Carrying value:
Cost ofDelivery Truck P 1, 200, 000
Accumulated Depreciation ( 570" 000) P 630,000
Proceeds ( 564.000)
l,oss on Disposal ofDelivery Truck P 6i.i00
PROBI,EM IO

1. Depreciation of main unit, 2004

(P 187,200 / 10 x9 / 12) 14,040
Deprecietion ofcomponent 1, 2004
(P30,000/6x9/12) 3,'7 50
Totsl Depreciation Expense, 2004
--17112!
2. Depreciation ofmain unit, 2010
(.P t87,200 / 10 ) t8,720
Depreciation of component 1, 2010
(P30,000/6x3l12) 1,250
Depreciation ofcomponent 2, 2010
l(P 4s,7s0 x75% ) / 4x9ll2l 6,434
Total Depreciatio[ Expense, 2010 __ 26,40!

3. Depreciation ofmain unit, 2011 18,720

Depreciation ofcomponent 2, 2011
l(P 45,750 x7s%) / 41 8,578
Total Depreciation Expense, 2011 27,29a