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How do compute for the gain on exchange to be recognized

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Reference no: EM132630649

Exchange of a PPE for a Financial Asset

On January 1, 2018, Neptune Company has a piece land acquired a year ago at a cost of P600,000. The land has a fair value of P700,000. On March 31, 2018, Neptune Company exchanged the land for a financial asset to be initially recognized at fair value through other comprehensive income. At the time of exchange, the shares, which was publicly listed, has a fair value of P820,000.

Question 1: Compute for the gain on exchange to be recognized in 2018.

Question 2: Provide the journal entry on March 31.

Reference no: EM132630649

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