Mac Lhenry M. Acabo BSA-3 Intermediate Accounting III
1. On May 1, 2020, H Company approved a plan to dispose of a business segment.
It is expected that the sale will occur on March 31, 2020. On December 31, 2020,
the carrying amount of the assets of the segment was P2,000,00 and the fair value
less cost of disposal was P1,800,000. During 2020, the entity paid employee
severance and relocation costs of P100,000 as a direct result of the discontinued
operation. The revenue and expenses of the discontinued segment during 2020
were:
Revenue Expenses
January 1 to April 30 1,500,000 2,000,000
May 1 to December 31 700,000 900,000
What amount should be reported as pre-tax loss from the discontinued segment
for 2020?
= 1,000,000
