End of Chapter Exercise 7.21

Excalibur Ltd operates in the Swan Valley in Western Australia where it is involved in the growing of grapes and the production of wine. In June 2016, it anticipated that its assets may be impaired due to a glut on the market for grapes and an impending tax from the Australian government seeking to reduce binge drinking of alcohol by teenage Australians.

Land is measured by Excalibur Ltd at fair value. At 30 June 2015, the entity revalued the land to its fair value of $119,900. The land had previously been revalued upwards by $19,900.

As a result of its impairment testing, Excalibur Ltd calculated that the recoverable amount of the entity?s assets was $1,456,000.

The carrying amounts of the assets of Excalibur Ltd prior to adjusting for the impairment test and the revaluation of the land were as follows:

Non-current assets
Buildings	$	850,300
Accumulated depreciation	(193,700	)
Land (at fair value 1/7/14)	127,800
Plant and equipment	1,453,400
Accumulated depreciation	(748,800	)
Goodwill	59,800
Accumulated impairment losses	(43,900	)
Trademarks ? wine labels	79,800
Current assets
Cash	7,100
Receivables	9,000

Required

Prepare the journal entries required on 30 June 2016 in relation to the measurement of the assets of Excalibur Ltd.

(Round your final answers to the nearest whole number. Enter debit entries first, followed by credit entries. Credit account titles are automatically indented when the amount is entered. Do not indent manually.)

	Account and explanation	Debit	Credit
(Revaluation of land)
(Adjustment for impairment test)
(Recognition of impairment loss)