The following information pertains to three different companies:

On January 1, 2021, Yvette Company classified non-current assets as held for sale that had
a carrying amount of P2,500,000. On this date, the assets are expected to sold for
P2,300,000. Reasonable and expected disposal cost to be incurred for sale was expected at
P100,000. By December 31, 2021, the asset had not been sold and management after
considering its options decided to place back the non-current asset into operations. On that
date, Yvette Company’s managers estimated that the non-current asset was now expected to
be selling at P1,800,000 with a disposal cost of P50,000, while depreciation for 2021 was
computed at P500,000 if the non-current was not classified as held for sale.
Tiktok Company acquired a patent right on July 1, 2019 for P1,250,000. The asset has a
remaining legal life of 10 years but due to the rapidly changing technology, management
estimates a useful life of only five years. On January 1, 2021, management is uncertain that
the process can actually be made economically feasible, and decides to write down the patent
to an estimated market value of P750,000. Amortization will be taken over three years from
that time.
On January 1, 2020, Edmond Company purchased bonds with face value of P5,000,000
designated as at amortized cost. The company paid P4,742,000. The bonds mature on
December 21, 2022 and pay 6% interest annually on December of each year with 8% effective
yield. The bonds are quoted at 105 on December 31, 2020. The bonds are sold at 110 on
December 31, 2021.
5. How much is the additional loss that shall be reported by Yvette Company in the 2021
statement of comprehensive income?
a. P200,000
b. P450,000
c. P250,000
d. P-0-
6. What is the amount of impairment loss recognized in the accounts of Tiktok Company in the
year 2021?
a. P312,500
b. P250,000
c. P125,000
d. P100,000
7. What is the carrying amount of patent that Tiktok Company should be reported in its
December 31, 2021 statement of financial position?
a. P500,000
b. P625,000
c. P937,500
d. P1,250,000
8. What amount of gain on sale of Edmond Company’s bonds should be reported in the 2021
statement of comprehensive income?
a. P758,000
b. P592,931
c. P672,291
d. P678,640