ABC Company purchased a machine on April 1, 2017. The related data are as follows: Cost P1,100,000 Estimated useful life 5 years Estimated residual value 110,000 The entity uses the straight-line method. On January 1, 2021, after a quality improvement review, the entity determined the following: New estimated useful life 10 years New estimated residual value P50,000

1.What is the carrying amount of the machine on December 31, 2021?

CDE Company purchased a machine on January 1, 2018. The related data is as follows: Cost P1,500,000 Estimated useful life 5 years Estimated residual value 300,000 The entity uses the straight-line method. On January 1, 2021, after a quality improvement review, the entity determined the following: New estimated useful life 8 years New estimated residual value 0

2. What is the depreciation of the machine 2021?

At the beginning of the current year, EFG Company purchased a mineral oil amounting to P3,000000 with removable ore estimated at 500,000 tons. After it has extracted all the ore, the entity will be required by law to restore the land to its original condition at an estimated fair value of P600,000. The entity believed it will be able to sell the property afterward for P500,000. During the current year, the entity incurred P1,500,000 in development costs in preparing the mine for production, and P1,000,000 in exploration costs. The development cost includes 60% of Tangible assets. The mine production removed 180,000 tons and sold 150,000 tons of are.

3. What is the carrying amount year-end?

HIJ Company, one of the largest mining companies, paid P10,000,000 to the local government for the right to explore and extract mineral reserves in an area of interest. The following costs were also incurred related to the exploration and evaluation activities of the entity. Total exploration costs P5,000,000 Evacuation costs 3,000,000 The results of the study revealed that the total estimated mineral reserves are 10,000,000 tons. The company started its commercial production in the year 2021. In 2021, the company produced 1,200,000 tons and sold 1,000,000 tons.

4. What is the amount of the amortization/depletion on the capitalized intangible exploration and evaluation cost for the year 2021?

On January 1, 2018, KLM Company acquired the following intangible assets: A trademark for P300,000. The trademark has a remaining legal life of 5 years and will be renewed in the future indefinitely without a problem. A patent for P3,500,000. The patent has an economic life is 10 years. On December 31, 2021, the intangible assets are tested for impairment. The trademark is now expected to generate cash flows of just P26,000 per year. The cash flows expected to be generated by the patent amount to P450,000 annually for each of the next remaining years. The appropriate discount rate for all intangible assets is 10%. The entity used 2 decimal places for the PV factor.

5. How much is the total impairment loss for the period?

On January 1, 2021, NOP Company signed an agreement to operate as a franchise. Annual payment at the beginning of each year for 3 periods, starting January 1, 2021 P300,000 Initial direct cost related to the acquisition of the franchise P150,000 Initial indirect cost related to the acquisition of the franchise P50,000 12% 3 years Effective rate 12% Franchise term 3 years Estimated useful life 10 years The entity used 2 decimal places for the PV factor.

6. What is the carrying amount of the Franchise on December 31, 2021?

On January 1, 2021, QRS Company signed an agreement to operate as a franchise. Down payment P150,000 Annual payment at the end of each year for 3 periods 250,000 Effective rate 10% Franchise term 3 years Estimated useful life 10 years The entity used 2 decimal places for the PV factor.

7. What is the interest expense on December 31, 2022?

TUV Company is planning to sell the business to new interests. The cumulative net earnings for the past five years are as follows: 2017 P2,000,000 2018 3,000,000 2019 4,000,000 2020 1,000,000 2021 2,000,000 The fair value of net assets is P12,500,000and the goodwill is determined by capitalizing average net earnings 15%.

8. What is the amount to be paid for goodwill?