Reference no: EM132696711
Peter Parker Company plans to dispose of a group of its assets as held for sale. The assets from a disposal group and are measured as follows;
--------------------------------------------------------------Carrying Amount ----------------------------Re-measured Amount
-------------------------------------------------Before Classification as Held for sale-----------Immediately before classification
Goodwill ----------------------------------------------------P3,000,000 --------------------------------------- P3,000,000
Property, plant and equipment
(revalued amount)------------------------------------------ 9,200,000------------------------------------------8,000,000
Property, plant and equipment
(historical amount)------------------------------------------11,200,000------------------------------------------11,200,000
Inventory -----------------------------------------------------4,800,000 ------------------------------------------4,400,000
Investment in available for sale ---------------------------3,800,000 ------------------------------------------3,200,000
Total-------------------------------------------------------- P32,000,000 ----------------------------------------P29,800,000
Peter Parker Company estimates that fair value less costs to sell of the disposal group amounts to P26,000,000.
Problem 1: When the disposal group was initially classified as held for sale, what amount of loss should Peter Parker Company recognize?
Group of answer choices
a. None
b. P2,200,000
c. P3,800,000
d. P2,000,000