Solution-What amount should be recognized as gain or loss

What amount should be recognized as gain or loss

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Reference no: EM133141743

Question 1 - Marcoleta Co. purchased equipment for P12,000,000 on January 1. 2022 with a useful life of 6 years and no residual value. On December 31, 2022, the entity classified the asset as held for sale. The fair value of the equipment on December 31, 2022 is P9,400,000 and the cost of disposal is P300,000. The fair value of the equipment on December 31, 2023 is P8 100,000 and the cost of disposal is P250,000, On December 31, 2023, the entity believed that the criteria for classification as held for sale can no longer be met. What amount should be recognized as gain or loss as a result of the reclassification in 2023?

Question 2 - In 2022, Padilla Co. decided to discontinue the Soap Division. On December 31, 2022, the division has not been completely sold. However, it is probable that the disposal will be completed within a year, Analysis of the records for the year disclosed the following information relative to the Soap Division:

Operating loss for 2022 P5,940,890

Loss on disposal of some assets during 2022 301,845

Expected operating loss in 2023 preceding final disposal 1,630,577

Expected gain in 2023 on disposal of division 1,980,423

What amount should be reported as pretax loss from discontinued operations in 2022?

Reference no: EM133141743

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What amount should be recognized as gain or loss

Reference no: EM133141743

Reference no: EM133141743

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