Agricultural Activities Flashcards
Art, science, and practice of farming (including cultivation of soil and rearing of animals) to provide food, wool, and other products
Agriculture
Management by entity of biological transformation and harvest of biological assets for sale or for conversion into agricultural produce or into additional biological assets
Agricultural activity
Comprises the processes of growth, degeneration, production, and procreation that causes qualitative or quantitative changes in a living plant or animal
Biological transformation
It is a living animal or plant
Biological asset
Biological assets that are to be harvested as agricultural produce or sold as biological assets
Consumable biological assets
Biological assets that are held to bear produce, and only the produce is harvested while the said asset remains.
Bearer biological assets
Consumable plants are classified as
Biological assets
Bearer plants are classified as
PPE
Animals for agricultural purposes (bearer or consumable) are classified as
Biological assets
Dogs, cats, goldfish, horses, and other animals that are treated as pets or for recreational purposes are classified as
PPE
They are not meant for human consumption.
Shrubs and trees for ornamental or decorative purposes are classified as
PPE
Harvested produce of a biological asset
Agricultural produce
Detachment of produce from a biological asset or cessation of a biological asset’s life process
Harvest
Examples of agricultural produce
- Grapes coming from a grape vineyard
- Apples from an apple tree
- Mango from a mango tree
Land used in agricultural activities is classified as
PPE
What is the agricultural produce of a beef cattle?
Carcass/meat
What is the agricultural produce of a sheep?
Wool
What is the agricultural produce of a rubber tree?
Harvested latex
Using the wool coming from a sheep, one product that can be produced is a wool jacket. In this case, the wool jacket is treated as
Inventories
Products that are the results of processing after harvest are treated as
Inventories
Agricultural produce at point of harvest is under what standard?
Agriculture (PAS 41)
Biological assets is under what standard?
Agriculture (PAS 41)
Bearer plants are under what standard?
PPE (PAS 16)
Initial measurement of biological asset
FV - Costs to sell
Subsequent measurement of biological asset
FV - Costs to sell
If FV cannot be measured reliably, the biological asset shall be measured at
Cost model
Cost - Accum. depreciation - Accum. impairment losses (if any)
When the FV becomes reliably measurable, use FV - Costs to sell as measurement basis
Costs to sell are the following:
- Broker’s commission
- Levies by regulatory agencies and commodity exchanges
- Transfer taxes and duties
Gain or loss from initial recognition of a biological asset at FV-CTS & change in FV-CTS shall be included in
P/L for period in which it arises
Costs incurred in biological assets measured at FV-CTS are recognized in
P/L
Changes in FV-CTS are recognized in
P/L
Components of changes in FV-CTS
- Price change
- Physical change
Separate disclosure of components of changes in FV-CTS (price change & physical change) is:
Encouraged (but not required)
Agricultural produce harvested from biological assets shall be measured at _______________ at the point of _____________.
FV-CTS; harvest
