2. Heavy Industries Company which has a calendar year-end uses the straight-line method of depreciation. i. On September 30, 2014, the company exchanged the old delivery equipment with the new delivery equipment for RM24,000. The old delivery equipment was purchased on January 1, 2012, for RM84,000 and was estimated to have a RM12,000 residual value at the end of its 5-year life. Depreciation on the delivery equipment has been recorded through December 31, 2013. It is estimated that the fair value of the old delivery equipment is RM39,000 on September 30, 2014. Continued... NMZ/AS BAC 1614 4/8 FUNDAMENTALS OF FINANCIAL ACCOUNTING OCT 2016 ii. On June 30, 2014, the company exchanged the old office equipment with the new office equipment for RM40,000. The old office equipment originally cost RM80,000 and had accumulated depreciation to the date of disposal of RM35,000. It is estimated that the fair value of the old office equipment on June 30 was RM50,000. The transaction has commercial substance. Required a) Prepare the journal entries to record the above two transactions (7 marks) b) Describe the accounting for natural resources, including their acquisition, cost allocation, and account titles (2 marks)