CASE 3

A. on January 1, 2021 machinery corp. enters into a contract with a customer for the sale of a machine and related one-year maintenance services for a total contract price of 2,000,000 machinery corp. regularly sells these items separately. if they were to be purchased separately. their stand-alone selling prices are as follows:

*1,800,000 for the machine and

*600,000 for the one-year maintenance services

Machinery corp transfers the machine, and collects the total contract price, on February 1, 2020. the maintenance services start on that date.

required

analyze the five steps of model of revenue recognition

B. Complete the table

Scope of Accounting Effect of Treatment Adjustment in PAS 8 Description BS/PL 1. Change in Accounting Policy 2. Change in Accounting Estimatecurrent year: C. Utter Space Corp. had the following securities outstanding at the beginning of the 10% convertible bonds payable, each P1,000 bond convertible into 10 ordinary shares or a total of P40,000 ordinary shares. 4,000,000 Ordinary shares capital, P100 par. 250,000 shares Authorized. 100,000 shares issued Net Income 10,000,000 5,000,000 Income tax rate 30% Required: Compute for Basic Earnings Per Share and Diluted Earnings Per Share D. Staples Company operates in a hyperinflationary economy. Its building has carrying amount of P1.000,000 on December 31, 2022. The building was acquired on June 21. 2020. The general price indices are as follows: June 21, 2020 100 December 31, 2021 150 Average - 2022 180 December 31, 2022 200 Required: Show your solution. 1. Compute for the building's restated amount on December 31, 2022. 2, Assume that the building is P200,000. Compute for depreciation's restated amount on December 31, 2022. 3. Assume further that the carrying amount of the building is P1,200,00 on December 31, 2021. Compute for the building's restated amount on December 31, 2022.3. Correction of prior period error