AMPATUA, Sittie Aisah L.

PAS 41 Agriculture Assignment!

Questions:

1. Biological Assets are living animals and living plants. Agricultural Produce is the
harvested product of the entity’s biological assets. Harvest is the detachment of
produce from a biological asset or the cessation of a biological asset’s life
processes.
2. Agricultural Activity or simply Agriculture is the management by an entity of the
biological transformation and harvest of biological assets for sale or for
conversion into agricultural produce or into additional biological asset.
3. Biological Transformation comprises the processes of growth, degeneration,
production, and procreation that cause qualitative or quantitative changes in a
biological asset.
4. An entity shall recognize a biological asset or an agricultural produce when it has
a control over the asset as a result of past events. When it is probable that future
economic benefits associated with the asset will flow to the entity. Thus, when
the fair value or cost of the asset can be measured reliably.
5. A Biological Asset shall be measured on initial recognition and at the end of each
reporting period at fair value less cost of disposal.
6. In accordance with IAS 41, agricultural produce growing on bearer plan shall be
classified and presented as biological asset. In addition, Harvested produce shall
be measured at fair value less cost of disposal at the point of harvest.
7. Bearer Plant is a living plant that is used in the production or supply of
agricultural produce and is expected to bear produce for more than one period.
Thus, it has a remote livelihood of being sold as agricultural produce, except for
incidental scrap sales.
8. Originally, bearer plants were considered as biological asset and is measured at
fair value less cost of disposal. Now, according to IASB, it should be accounted
the same way as property, plant, and equipment for its operation is similar to that
of manufacturing.
9. Bearer Animals shall be accounted and reported as Biological Assets.
10. Animal-related Recreational Activities are not treated as agricultural activity for
there is no management of the transformation of the biological asset but simply
control of the number of animals.

Multiple Choice:

Problem 22-10

1. B 6. D
2. A 7. D
3. D 8. B
4. C 9. B
5. D 10. A
Problem 22-11

1. A 6. A
2. D 7. B
3. B 8. C
4. C 9. C
5. C 10. B

Problem 22-12

1. C
2. C
3. A
4. C
5. A