QUIZZIZ BHIE (Second Year)

The cost of property, plant, and equipment acquired in an exchange is measured at the

• FV of the asset given plus cash payment

• FV of the asset received plus cash payment

• Carrying amount of the asset given plus cash payment

• Carrying amount of the asset received plus the cash payment

Which cost should be expensed immediately?

• initial operating loss

• administrative overhead

• cost of relocating or reorganizing part or all of an entity's operation

• all of these are expensed immediately

Which of the following is not a characteristic of property, plant, and equipment?

• The PPE are tangible assets

• The PPE are used in business

• The PPE are expected to be used over a period of more than one year

• The PPE are subject to depreciation

The valuation model should an entity use to measure PPE?

• revaluation model or the FV model

• cost model or the revaluation model`

• cost model or FV through profit or loss

• cost model or FV model

In an exchange with commercial substance

• only loss should be recognized

• only gain should be recognized

• gain or loss is recognized entirely

• gain or loss is not recognized

An entity purchased a plant asset under a deferred payment contract. The agreement was to pay P10,000 per year for five years. The plant asset is initially measured at

• P50,000

• P50,000 plus imputed interest

• Future value of a P10,000 annuity for five years

• Present value of a P10,000 annuity for five years at an imputed interest

An entity purchased a plant asset under a deferred payment contract. The agreement was to pay P10,000 at the time of purchase and P10,000 at the end of each of the next five years. The plant asset is measured initially at

• P60,000 plus imputed interest

• P60,000 less imputed interest

• P60,000

• The present value of a P10,000 ordinary annuity

What is the amount to be capitalized as cost of the machine?

• 950,000

• 980,000

• 1,130,000

• 1,100,000

What is the initial cost of the machine?

• 2,050,000

• 2,000,000

• 2,450,000

• 2,400,000

What is the interest expense for 2018?

• 125,664

• 113,212

• 176,000

• 103,664