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Biological Assets Sample Problems

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707 views6 pages

Biological Assets Sample Problems

Uploaded by

junaveesedillo747
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
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1.

Forester Company provided the following assets in a forest plantation and farm

Free standing trees 5,000,000


Land under trees 600,000
Roads in forest 300,000
Animals related to recreational activities 1,000,000
Bearer plants 1,500,000
Bearer animals 2,000,000
Agricultural produce growing on bearer plants 800,000
Agricultural produce harvested 1,200,000
Plant with dual use 1,400,000

1. What total amount should be reported as biological assets?


a. 7,800,000
b. 7,200,000
c. 8,400,000
d. 9,200,000
2. What total amount should be included in property, plant and equipment?
a. 4,600,000
b. 3,400,000
c. 1,800,000
d. 4,200,000

2. Joan Company provided the following data :

Value of biological asset at acquisition cost on December 31, 2021


Fair valuation surplus on initial recognition at fair value on December 31, 2022
Increase in fair value on December 31, 2022 due to growth and price fluctuation
Decrease in fair value due to harvest in 2022

1. What is the carrying amount of the biological asset on December 31, 2022?
a. 7,400,000
b. 7,300,000
c. 7,500,000
d. 6,500,000
2. What amount of net gain from change in fair value of biological asset should be reported in the 20
income statement?
a. 1,400,000
b. 1,300,000
c. 900,000
d. 800,000
3. Salve Company is engaged in raising dairy livestock. The entity provided the
following information during the current year:

Carrying amount on January 1


Increase due to purchases
Gain in fair value arising from change in fair value less cost of disposal attributable to price change
Gain in fair value arising from change in fair value less cost of disposal attributable to physical chan
Decrease due to sales
Decrease due to harvest

3. Solution
Carrying amount on January 1
Increase due to purchases
Gain in fair value arising from change in fair value less cost of disposal attributable to price change
Gain in fair value arising from change in fair value less cost of disposal attributable to physical chan
Decrease due to sales
Decrease due to harvest
Carrying amount on Decemeber 31
and farm 1. Solution
Free Standing Trees 5,000,000
Bearer animals 2,000,000
Agricultural produce growing on bearer plants 800,000
Plant with dual use 1,400,000
Total biological assets 9,200,000
2. Solution
Land under trees 600,000
Roads in forest 300,000
Animals related to recreational activities 1,000,000
Bearer plants 2,000,000
Total PPE 3,900,000

Agricultural produce harvested should be included in inventory

6,000,000
500,000
uctuation 900,000
100,000

1. Solution
Value of biological asset at acquisition cost on December 31,
Fair valuation surplus on initial recognition at fair value on De
Increase in fair value on December 31, 2022 due to growth an
Decrease in fair value due to harvest in 2022
t should be reported in the 2022 Carrying Amount December 31, 2022
2. Solution
Change in fair value in 2022
Decrease in fair value due to harvest in 2022
Net gain from change in fair value

vided the

5,000,000
2,000,000
attributable to price change 400,000
attributable to physical change 600,000
850,000
200,000

5,000,000
2,000,000
attributable to price change 400,000
attributable to physical change 600,000
-850,000
-200,000
6,950,000
sition cost on December 31, 2021 6,000,000
cognition at fair value on December 31, 2022 500,000
er 31, 2022 due to growth and price fluctuation 900,000
est in 2022 (100,000)
7,300,000
900,000
est in 2022 (100,000)
800,000

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