Corona Textiles Berhad, a company produces exclusive Digital Printed Batik was incorporated several years ago in Kota Bharu, Kelantan. On 1 June 2016, the company decided to acquire a new high-tech digital machine from China to cater for the increasing demand of Digital Printed Batik. The purchase price of the machine was RM650,000. Below are the additional costs incured related to the acquisition of the machine.

RM Insurance on shipment 18,000 Trade discount on purchase price 5% Import duties and taxes 25,000 Delivery and transportation costs 5,000 Wages for offloading and internal delivery to the factory 8,800 Installation charges 32,000 Administrative and general overhead expenses 10,000 Maintenance charges for 2 years 55,000 Start-up and pre-production costs 8,000

Included in the installation charges was RM9,300 being the cost of rectification work carried out by the supplier due to wrong specification given by Corona Textiles Berhad. At the end of the useful life, Corona Textiles Berhad will incur dismantling cost of RM50,000 but its present value was RM45,000. The machine is expected to be used for 10 years and residual value is estimated to be RM75,000. The machine was ready to be used starting from 1 July 2016 whereby depreciation was also charged on straight-line from that date on monthly basis. The company closes its book on 31 December each year. On 1 July 2019, the machine having some technical problems and the management planned to dispose the machine. On that date, the fair value less cost to sell and the value in use of the machine were RM525,000 and RM515,000 respectively, and the residual value is estimated to be zero. The machine was disposed on 31 December 2019 for RM485,000.

Required: a. Indicate whether the machine is an asset of Corona Textiles Berhad. b. Explain briefly whether the machine is a property, plant and equipment in accordance with the MFRS 116 Property, Plant and Equipment. c. Discuss the initial cost of the machine and it carrying amount in the Statement of Financial Position as at 31 December 2018.