answer number 3

MODERNA Company is located in CEBU and uses international accounting standards. MODERNA Company purchased equipment 8 years ago for P1,000,000. The equipment has been depreciated using the straight-line method with a 20-year useful life and 10% residual value. MODERNA'S operations have experienced significant losses for the past 2 years and, as a result, the company has decided that the equipment should be evaluated for possible impairment. The management of MODERNA Company estimates that the equipment has a remaining useful life of 7 years. Net cash inflow from the equipment will be P80,000 per year. The fair value of the equipment is P240,000. No goodwill was associated with the purchase of the equipment. MODERNA Company has chosen to recognize increases in the value of long-term operating assets in accordance to the allowable alternative under PAS/IAS 16. REQUIRED: hif Tecos (3) What journal entry should MODERNA Company make if the fair value of the building was P980,000