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3. What is the carrying amount of the biological assets on December 31,

2022?
BIOLOGICAL ASSETS, AGRICULTURAL PRODUCE AND BEARER PLANTS a. 2,050,000
b. 2,300,000
1. Eagles Company provided the following balances for the year 2021 and c. 2,200,000
2022 regarding biological assets acquired on December 31, 2021: d. 1,950,000

Purchase price of biological assets on December 31, 2021, 1,500,000 4. What is the gain on agricultural produce that shall be reported in the
current year?
Fair valuation surplus on initial recognition at a. 250,000
fair value less cost of disposal on December 31, 2021 150,000 b. 300,000
c. 100,000
Increase in fair value on December 31, 2022, d. 0
due to growth and price changes 400,000
Decrease in fair value in 2022 fair value due to harvest 50,000
Additional newborn biological asset on December 1, 2022
at fair value less cost of disposal 200,000
Agricultural produce harvested from the biological asset
during the year 100,000
at fair value less cost of disposal

1. What is the gain from fair value change in 2021?

a. 150,000
b. 100,000
c. 200,000
d. 0

2. What is the net gain on biological assets that shall be reported in the
current year?
a. 350,000
b. 550,000
c. 450,000
d. 600,000
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3. Bea Farms Company has different kinds of farm animals used in agricultural 4. What is the gain from price change?
activity on January 1, 2021. During 2021, several acquisitions occurred #3 10 Dairy Cattle 2 yo 400,000
related to these farm animals. A detailed summary of these transactions is 20 Hogs 3 yo 500,000
as follows:
15 Horses 1 yo 1,000,000
Carrying amounts on January 1, 2021: 8 Carabaos 2.5 yo 200,000
Total CA 1/1/21 2,100,000
10 Dairy cattle (2 years old) 400,000
20 Hogs (3 years old) 500,000 4 Dairy Cattle 1 yo 150,000
15 Horses (1 year old) 1,000,000 6 Carabaos 6 mos. 100,000
8 Carabaos (2.5 years old) 200,000
Total cost of BA purchased on June 30 250,000
Biological assets purchased on June 30, 2021:
Total CA before FV adjustment (2.1M + 250k) 2,350,000
4 Dairy cattle (1 year old) 150,000
6 Carabaos (6 months old) 100,000
10 Dairy Cattle 3 yo 580,000
Fair value less cost to sell December 31, 2021:
20 Hogs 4 yo 600,000
10 Dairy cattle (2 years old) 520,000 15 Horses 2 yo 1,350,000
20 Hogs (3 years old) 550,000 8 Carabaos 3.5 yo 290,000
15 Horses (1 year old) 1,200,000 4 Dairy Cattle 1.5 yo 200,000
8 Carabaos (2.5 years old) 250,000 6 Carabaos 1 yo 140,000
4 Dairy cattle (1 year old) 170,000 FV on 12/31 with both Physical and Price Change 3,160,000 2. C
6 Carabaos (6 months old) 110,000
10 Dairy cattle (3 years old) 580,000
20 Hogs (4 years old) 600,000
15 Horses (2-year-old) 1,350,000 FV on 12/31 with both Physical and Price Change 3,160,000
8 Carabaos (3.5 years old) 290,000 Less: Total CA befor FV adjustment (2.1M + 250k) 2,350,000
4 Dairy cattle (1.5 years old) 200,000 Total gain from FV change 810,000 1. B
6 Carabaos (1 year old) 140,000
There were no farm animals sold during the year and neither were there any
newborns nor deaths. 10 Dairy Cattle 2 yo 520,000
20 Hogs 3 yo 550,000
1. What is the gain from fair value change included in profit or loss
15 Horses 1 yo 1,200,000
2. What is the carrying amount of the farm animals on December 31, 2021?
3. What is the gain from physical change? 8 Carabaos 2.5 yo 250,000
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4 Dairy Cattle 1 yo 170,000

6 Carabaos 6 mos. 110,000
FV on 12/31 with Price Change W/O physical change 2,800,000

FV on 12/31 with both Physical and Price Change 3,160,000

FV on 12/31 with Price Change W/O physical
Less: change 2,800,000
Gain from physical change 360,000

FV on 12/31 with Price Change W/O physical change 2,800,000

Less: Total CA befor FV adjustment (2.1M + 250k) 2,350,000
Gain from Price Change 450,000

4. Bernadette Company reclassified certain assets as biological assets. The

total value of the assets is P13,500,000 which comprised the following:

Living trees to be harvested as log and lumber 8,000,000

Four hectares of land where trees are planted 600,000
Mature bearer plants 800,000
Immature bearer plants 200,000
Mature bearer animal 1,000,000
Immature bearer animals 500,000
Roads in forest 2,000,000
Animals related to recreational activities 400,000

1. What is the total amount of the assets that should be classified as

biological assets?
a. 9,000,000
b. 7,100,000
c. 9,900,000
d. 9,500,000
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2. What is the total amount of the assets that should be classified as

property, plant and equipment?
a. 3,400,000
b. 4,500,000
c. 3,800,000
d. 4,000,000

5. Jericho Company purchased 1,000 sheep on January 1, 2021. These sheep

will be sheared semiannually, and their wool sold to specialty clothing
manufacturers.

The sheep were purchased at fair value less cost to sell of P250,000. During
2021 the change in fair value due to growth and price changes is P35,000,
the wool harvested had a fair value less cost to sell of P15,000 at the point of
harvest.

On December 31, 2021, the wool had not yet been sold and had net
realizable value of P12,000. The change in fair value due to harvest of the
sheep is (P7,500).

1. What is the value of the sheep on Jericho’s statement of financial

position on December 31, 2021?
a. 292,500
b. 289,500
c. 250,000
d. 277,500

2. What is the net amount of fair value gains for the biological assets?
a. 35,000
b. 7,500
c. 22,500
d. 27,500

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