11.

B
Journal Entry (elimination approach):
Accumulated depreciation- building ₱400,000.00
Revaluation surplus ₱280,000.00
Revaluation loss ₱520,000.00
(P800,000 – P280,000)
Building ₱1,200,000.00

12. C ₱578,000.00
Depreciation for 2010:
Building (P3,200,000/25) ₱128,000.00
Motor vehicle (P1,800,000/4) ₱450,000.00
Total ₱578,000.00

13. C ₱21,000.00
Cost Replacement Cost Appreciation
Machinery ₱120,000.00 ₱150,000.00 ₱30,000.00
Accum. Dep. ₱36,000.00 ₱45,000.00 ₱9,000.00
Net ₱84,000.00 ₱105,000.00 ₱21,000.00

The entry to record the revaluation is:

Machinery ₱30,000.00
Accumulated depreciation ₱9,000.00
Revaluation surplus ₱21,000.00

14. A ₱17,500.00
Revaluation surplus ₱22,500.00
Less: Realization through depreciation in 2010 and 2011 (P22,500/
₱5,000.00
9 x 2)
Balance before impairment recognition, Dec. 31, 2011 ₱17,500.00

15. B ₱2,000.00
Fair value of machine at Dec. 31, 2009 ₱112,000.00
 Less: Depreciation, 2010 – 2011 (P112,500/ 9 x 2) -₱25,000.00
Carrying value, Dec. 31, 2011 ₱87,500.00
Less: Recoverable value -₱68,000.00
Decrease in value ₱19,500.00
Less: Revaluation surplus -₱17,500.00
Impairment loss ₱2,000.00

16. A First Land

Fair value of shares (50,000 shares x 120) ₱6,000,000.00
Second Land ₱1,200,000.00
Total cost ₱7,200,000.00

17. A Cost ₱840,000.00

Shipping cost ₱50,000.00
Centrifuge cost ₱80,000.00
Water line ₱40,000.00
Labor and testing cost ₱60,000.00
Materials used up in testing cost ₱30,000.00
Total ₱1,100,000.00

18. A Fair value of old machine ₱700,000.00

Cash payment ₱160,000.00
Cost of new machine ₱860,000.00

19. B Fair value of old machine ₱700,000.00

Carrying amount (50% x 1,200,000) -₱600,000.00
Gain on exchange ₱100,000.00

20. B Cash price of new machine ₱2,500,000.00

Cash payment -₱600,000.00
Fair value of old machine ₱1,900,000.00
Carrying amount of old machine ₱2,000,000.00
Loss on exchange -₱100,000.00