Activity 11a:

(A) How much should be recorded as the purchase price of the individual PPE items:

1. Equipment has an invoice price of P1,000,000, and a credit term of 2/30, n/60. Cash discount was not taken.

2. Paid cash of P200,000 and issued a note for the purchase of a machinery. The note has a face value of P1,000,000 due after three years and an effective interest rate of 7%.

3. Five units of equipment was purchased through the issuance of 1,000 pieces of P1,000 parvalue shares. Each equipment has a fair value of P300,000 while a share is valued at P1400.

4. Issued bonds with face value of P5,000,000 and fair value of P5,100,000 to purchase equipment with a fair value of P4,900,000.

5. The old equipment has an original cost of P1,500,000, accumulated depreciation of P600,000, and fair value of P1,000,000. The new equipment obtained through exchange has a fair value of P1,200,000. The balance was settled with cash. The exchange will not affect the future cashflows of the entity.

(B) For items 6 to 10, identify the amount to be include as Land

6. Cost of option to the land - P20,000

7. Legal fees and other expenditures for establishing clean title - P100,000

8. Mortgage assumed: Total mortgage - P2,000,000, Remaining mortgage as of acquisition date - P 500,000

9. Real property tax not paid by seller and assumed by the entity, P50,000 due January of current year. Buyerentity acquired the land on April 30 of the current year.

10. Special assessment paid to the government - P300,000

11. Fence and landscaping - P500,000

(C) For items 11 and 12, identify the amount to be included as Building assuming the asset was purchased

12. Payments to tenants to induce them to vacate the building -P600,000

13. Ventilating system added - P400,000

(D) For items 13 to 17, identify the amount to be included as Building assuming the asset was constructed

14. Excavation cost of land to start construction - P350,000.

15. Builtin cabinets in the building cafeteria - P 100,000

16. Refrigerator and food trolleys - P300,000

17. After using the asset for two years, additional lighting was installed - P500,000

18. Payment for injuries to thirdparties not covered by insurance - P200,000

(E) For items 18 to 22, identify the amount to be included as Equipment

19. Freight amounted to P50,000 and freight insurance amounted to P5,000.

20. Site preparation of P100,000 and installment cost of P75,000.

21. Test run cost which includes P10,000 materials, P15,000 direct labor cost, P1,000 allocated supervisor's salary and other overhead cost of P5,000. The good produced was sold for P30,000.

22. Valueadded tax amounting to P100,000

23. Import tax of P30,00