What amount should the biological assets be reported in dec

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Tamaraw Company purchased cattle at an auction for P 300,000 on July 1, 2020. Cost of transporting the cattle back to the company's farm was P 3,000 and the company would have to incur cost similar transportation cost if it was to sell the cattle in the auction in addition to auctioneer's fee of 2% of sales price.

On December 31, 2020, after taking into account the location, the fair value of the biological assets had increased to P 500,000 (that is, the market price including the cost of transporting the asset).

Problem 1: What amount should the biological assets be reported in the December 31, 2020 statement of financial position?

a. P487,000

b. P490,000

c. P497,000

d. P500,000

Reference no: EM132712661

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