1: On 1 April 2015, Agency C exchanged an aircraft with a carrying amount of P6,000,000 for a copyright whose fair value cannot be reliably measured. 

1. What is the cost of the copyright at initial recognition?

2. If on the date of acquisition, the fair value of the copyright was P4,000,000, at what cost should the copyright be initially recognized?

 2: On January 1, 2015, Agency A spent P8,575,000 developing a new computer software. Of this amount, P3,575,000 was spent before technological feasibility was established for the software. The software is expected to increase total cost savings by P16,000,000 and to operate with an estimated useful life of 10 years. On December 31, 2015, Agency A successfully completed the software.

Requirements: 

a. Prepare journal entries for the foregoing facts. 

b. Prepare the entry to record amortization at December 31, 2015. 

c. At what amount should the computer software be reported in the December 31, 2015 Statement of Financial Position? 

d. What information should be disclosed in the notes to Financial Statements?

Answer rating: 100% (QA)

Lets address each of your questions separately Question 1 Agency C Exchange What is the cost of the copyright at initial recognition The cost of the c... View the full answer