1. How do you recognize non-current assets held for sale?

A noncurrent asset is presented in the classified statement of financial position as

current asset only when it qualifies to be classified as “held for sale” in accordance with
PFRS 5. We recognized non-current asset held for sale if its carrying amount will be
recovered principally through a sale transaction rather than through continuing use and
if it is available for immediate sale in its present condition subject only to terms that are
usual and customary and if the sale is highly probable.

2. Give at least five examples of revenue from contracts to customer.

 Sky Co. is committed to sell its office building to a buyer and will transfer
the ownership to the buyer after Sky Co. vacates the building.
 Bibi Co., a seller of concrete aggregates, enters into a contract with Bebe
Co. to deliver goods. Payment is due one month after delivery.
 Bee Company enters into a contract with Dee Company to deliver 2
refrigerators, 3 washing machines, and 5 television sets for a total
consideration of ₱150,000.
 Del Co., a manufacturer and dealer of printing machines, receives an
order for the manufacture of a customized machine for a customer. The
customer pays half of the consideration at contract inception.
 Bob Uy, a seller of appliances, enters into a contract with XYZ Co. for the
sale of 20 units of microwave oven. Payment is due one month after
delivery.

3. How would you identify a transaction from discontinued operation?

A discontinued operation is a component of an entity that either has been
disposed of or is classified as held for sale. We identify a transaction from discontinued
operation if it represents a major line of business or geographical area of operations,
part of a single coordinated plan to dispose of a separate major line of business or
geographical area of operations and a subsidiary acquired exclusively with a view to
resale.
 4. What are the effect of unclassified accounts in the financial statements to
the stakeholders?
An unclassified statement of financial position simply lists all normal line items
found in a balance sheet in their order of liquidity. It only provides minimal information,
and it is not that useful for stakeholders. It is simpler to produce, but may warrant
additional questions from investors or outside parties about the character of your net
worth or liquidity position. This is why classification of accounts is important for
stakeholders in order for them to make informed decisions in analyzing the business
performance, position, and improvement over time.

5. In case of intentional or unintentional errors made during the recording of

transactions and discovered after the balance sheet date but before the
issuance of the financial statements, as accountant how do you resolve the
issues?
As an accountant, in case of intentional or unintentional errors made during the
recording of transactions and only discovered after the balance sheet date, an
adjustment must be made because the discovery of fraud or errors that indicate that the
financial statements are incorrect is considered as an adjusting event after the reporting
period as they provide evidence of conditions that they existed at the end of the
reporting period. Therefore, the entity shall adjust the amounts recognized in its
financial statements and disclose relevant information to reflect such events.