On July 1, 20X5, Suarez Company declared as property dividends inventory with a carrying amount of P4
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Question:
On July 1, 20X5, Suarez Company declared as property dividends inventory with a carrying amount of P4 million. Information on fair values is as follows:
Fair Value*
July 1, 20X5
P4.4 million
July 31, 20X5
P4.8 million
The fair value is not materially different from the net realizable value.
Required
- How much is the debit to retained earnings on July 1, 20X5?
- On July 31, 20X5, the property dividends payable is settled. How much is the gain or loss on settlement recognized in P&L?
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