2. Assets Buff Peeps Inc operates gym studios in Singapore. Its financial year ends on June 30. On I March 20x2, Buff Peeps Inc purchased 5 new gym machines from a supplier in Vietnam using cash of $45,000. The machines were shipped under FOB Destination and the shipping costs $1,000. The machines arrived on 1 April 20X2. The cost of installing the machines was $3.000. The gym machines were estimated to have a useful life of 10 years and a residual value of $5,000 in all. Buff Peeps Inc used double declining balance method to depreciate the gym machines Required: 1) Prepare the journal entry for the acquisition of the 5 gym machines 2) Prepare the journal entry for depreciation of the gym machines for the year ended 30 June 20x2. 3) Prepare the journal entry for depreciation of the gym machines for the year ended 30 June 20X3. 4) On1 July 20X3, Buff Peeps Inc re-assessed its assumptions and concludes that the gym machines useful life should have only been 5 years with a residual value of $10,020 in all. This means the gym machines should be fully depreciated by 30 March 20X7. Going forward, Buff Peeps Ine decides to depreciate the gym machines on a straight line basis. Calculate the depreciation expense for the year ending 30 June 20x4. 5) On 1 July 20x4, a new generation of gym machines is introduced. This causes the fair value (less selling and removal cost) of Buff Peeps inc's gym machine to be reduced to $4,000 each. The value- in-use (net present value) also decreased to $3,600 per gym machine Prepare the journal entry required on 1 July 20X4. 6) On 31 December 20X4, Buff Peeps Inc decided to trade in the old gym machines and pay an additional $60,000 for the new generation gym machines offered by the same supplier. The market value for the new gym machines is $80,000 Prepare the journal entry required on 31 December 20X4. 7) On 1 January 20Xs, OnePunch Gym decided to acquire Buff Peeps Inc for $600,000. The book value of total assets as of January 1 20x5 is S560,000. The book and fair value of total liabilities as of 1 January 20x5 are both S100,000. The fair value of total assets as of January 20x5 is 580,000. Please calculate the goodwill of this deal for One Punch Gym. 8) After seeing how profitable gym machines can be, Buff Peeps Inc decides to partner with its supplier to create the next generation gym machines. Buff Peeps Inc incurred 550,000 research costs relating to early stage prototypes before spending another $150,000 on developing the final product called MusclePeeps. The final product has shown to be successful with several customers already signing up for preorders. Provide the journal entries to record the above transactions