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This document contains 3 accounting problems related to biological assets and property, plant, and equipment. The first problem provides values for various biological assets and asks the total value of biological assets and property, plant, and equipment on December 31, 2015. The second problem provides information about a coconut tree and fruits and asks to calculate various book values and gains/losses over 2015-2016. The third problem provides information about pigs owned by a farm and asks to calculate biological asset values, fair value changes, and gains from physical changes over 2011.

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CPA Board Operation Page 1 of 1

Uploaded by

Tina Pascual

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PSBA

Accounting 15
Biological Asset

Problem 1. The following are provided by Farm Inc. for the year ended December 31, 2015 with their corresponding
proper measurement:
Rice plant P100,000
Corn plant 200,000
Cow 300,000
Plant bearing fruit 400,000
Horse for recreation purposes 500,000
Agricultural land 600,000
Required: What is the total biological assets on December 31, 2015? What is the total PPE on December 31, 2015?

Bearer Plant (PAS 41 and Pas 16)

Problem 2. On January 1, 2015, Planter Inc. acquired a coconut tree at a cost of P10,000 with a residual value of P2,000
and useful life of 5 years. On December 31, 2015, the coconut tree bear several fruits with a fair value less cost to sell of
P5,000. On December 31, 2015, the fair value less cost to sell of the coconut tree is P20,000. On December 31, 2016, the
coconut fruits have a fair value less cost to sell of P8,000 while the coconut tree has a fair value less cost to sell of
P25,000. The coconut fruits were harvested on January 1, 2017 and to be sold as inventory.
Required: Determine the following:
__________1. Book value of coconut tree on December 31, 2015
__________2. Book value of coconut tree on December 31, 2016
__________3. Book value of coconut fruits on December 31, 2015
__________4. Book value of coconut fruits on December 31, 2016
__________5. Total gain or (loss) as a result of change in fair value in 2015
__________6. Total gain or (loss) as a result of change in fair value in 2016
__________7. Initial measurement or cost of inventory on January 1, 2017

Biological Assets (PAS 41)

Problem 3. The Farm Inc. is engaged in poultry business. On January 1,2011, the following data are provided concerning
the pigs of The Farm:

Biological Asset Fair Value less Cost to Sell

100 pigs (1-year old) P2,000

On July 1,2011, The Farm purchased 200 pigs (6 months – old) for P1,500 each. On October 1,2011, 300 pigs were born
and the fair value less cost to sell on such date of new born is P1,000.

The active market provided the fair value less cost to sell of the pigs on December 31,2011:

Biological Asset Fair Value less Cost to Sell

New Born P1,200
3-month Old 1,400
6-month Old 1,800
1-year Old 2,200
2-year Old 2,500

Required: Determine the following:

____________1. Biological Asset on December 31,2011

____________2. Total Gain or (Loss) on Changes in Fair Value less Cost to Sell in Profit or Loss
____________3. Gain or (Loss) arising from price change
____________4. Gain or (Loss) arising from physical change consisting of (1) growth and (2) birth