Problem 1

Indicate whether each of the following is

1 A
2 C
3 D
4 B
5 A
6 D
7 C
8 C
9 D
10 A
11 E - Land Improvements (PPE)
12 A
13 C
14 D
15 D
16 C
17 B
18 C
19 A
20 D
21 B
22 C
23 D
24 D
25 C
26 B
27 C
28 D
29 A
30 B
Problem 2

Requirements:
a Determine the amount at which biological assets would be presented in the stateme
financial position at December 31, 2019.

Beginning Balance of Biological Assets, 12/31/2018

Add: Purchases of biological assets during 2019
Purchase Price 3,200,000.00
Less: Fair valuation loss on initial recognition (150,000.00)
Add: Increase in fair value due to biological transformation
Less: Decrease in fair value due to harvest
Ending Balance of Biological Assets, 12/31/2019

b Indicate the accounts and the amounts that will be shown on the statement of
comprehensive income relating to the above.

Fair valuation loss on initial recognition (150,000.00)

Gain - Increase in fair value due to physical change 2,000,000.00
ented in the statement of

2,800,000.00

3,050,000.00
2,000,000.00
(1,000,000.00)
6,850,000.00

statement of
Problem 3

a Prepare a schedule showing the reconciliation of beginning balances to ending bala

biological assets and the changes during the period due to purchase and change in

Increase in Fair Value due to Price Change

3 - year old animal 6,000,000.00
2 - year old animal (purchased on 7/1/2018) 2,500,000.00
2 - year old animal (purchased on 12/31/2018) 1,250,000.00

Increase in Fair Value due to Physical Change

4 - year old animal 16,000,000.00
3 - year old animal (purchased on 7/1/2018) 9,500,000.00
3 - year old animal (purchased on 12/31/2018) 4,750,000.00

Total Increase in Fair Value during 2019

Beginning Balance of Biological Assets, 12/31/2018

3 - year old animal 88,000,000.00
2 - year old animal (purchased on 7/1/2018) 35,000,000.00
2 - year old animal (purchased on 12/31/2018) 17,500,000.00

Add: Total Increase in Fair Value during 2019

Ending Balance of Biological Assets, 12/31/2019

To Reconcile:
Ending Balance of Biological Assets, 12/31/2019
4 - year old animal 110,000,000.00
3 - year old animal (purchased on 7/1/2018) 47,000,000.00
3 - year old animal (purchased on 12/31/2018) 23,500,000.00

Journal Entry:
12/31/2019
Biological Assets 40,000,000.00
Gain - Increase in Fair Value due to Price Change
Gain - Increase in Fair Value due to Physical Change
nces to ending balance of
hase and change in fair value.

9,750,000.00

30,250,000.00

40,000,000.00

140,500,000.00

40,000,000.00

180,500,000.00

180,500,000.00

9,750,000.00
30,250,000.00
Problem 4

Requirements:
a Compute for the changes in fair value less cost to sell attributable to price change a

Increase in Fair Value due to Price Change:

2.5 - year old animal (purchased on 7/1/2019) 300.00
2 - year old animal 5,000.00
Newborn animal (born on 7/1/2019) 200.00

Increase in Fair Value due to Physical Change:

Newborn animal (born on 7/1/2019) 7,000.00
3 - year old animal (purchased on 7/1/2019) 900.00
3 - year old animal 15,000.00
0.5 - year old animal (born on 7/1/2019) 800.00

Total Increase in Fair Value during the year

Beginning Balance of Biological Assets, 1/1/2019

2 - year old animal

Add: Purchases during 7/1/2019

2.5 - year old animal (purchased on 7/1/2019)

Add: Total Increase in Fair Value during the year

Less: Decrease in Fair Value due to sales

3 - year old animal
Selling Price 13,500.00
Less: Cost to Sell (1,500.00)
Net Selling Price 12,000.00
Multiply by 2 animals sold 2.00

Ending Balance of Biological Assets, 12/31/2019

To Reconcile:
Ending Balance of Biological Assets, 12/31/2019
3 - year old animal (purchased on 7/1/2019) 12,000.00
3 - year old animal 96,000.00
0.5 - year old animal (born on 7/1/2019) 8,000.00

Journal Entries
7/1/2019
Biological Assets 10,800.00
Cash

Biological Assets 7,000.00

Gain - Increase in Fair Value due to Physical Change

12/31/2019
Biological Assets 22,200.00
Gain - Increase in Fair Value due to Price Change
Gain - Increase in Fair Value due to Physical Change

Cash 24,000.00
Biological Assets
le to price change and physical change.

5,500.00

23,700.00

29,200.00

100,000.00

10,800.00

29,200.00

(24,000.00)

116,000.00

116,000.00
10,800.00

7,000.00

5,500.00
16,700.00

24,000.00