Matsumura Dairy began operations on April 1, 2015, with the purchase of 200 milking cows for ¥6,700,000. It has completed the first month of operations and has the following information for its milking cows at the end of April 2015 (yen in thousands).

Instructions

(a) Prepare the journal entries for Matsumura’s biological asset (milking cows) for the month of April 2015.

(b) Prepare the journal entry for the milk harvested by Matsumura during April 2015.

(c) Matsumura sells the milk harvested in April on the local milk exchange and receives ¥74,000.
Prepare the summary journal entry to record the sale of the milk.

Transcribed Image Text:

Milking cows Change in fair value due to growth and price changes* Decrease in fair value due to harvest Milk harvested during April 2015 (at net realizable value) (200,000) (12,000) 72,000