1. Entity A sold computer accessories. The draft accounts for the year ended 31 December 2014 included a motor van with the cost of $1,985,000 which was bought on 1 January 2012. Its economic life is assumed to be 8 years.

   However, the market has turned down on 1 January 2015, as a result, the motor van was estimated that it could only be able to generate $210,000 cash at each year ended of 2015, 2016, 2017, 2018 and 2019 respectively. It will then be scrapped on 31 December 2019 with a scrap value of $25,000.

   Alternatively, the motor van could be sold immediately on 1 January 2015 for $840,000 and $95,000 selling costs incurred. Market interest rates are 12% per annum.

   Recoverable amounts on 31 December 2015 and 31 December 2016 are $750,000 and $850,000 respectively.

   On 1 January 2016, Entity A changed the depreciation method from the straight-line method to reducing balance method of 20% annually.

   On 31 December 2017, Entity A sold the motor van for $580,500.

   REQUIRED:

   According to accounting standards, provide all necessary journal entries of Entity A on 31 December 2014, 31 December 2015, 31 December 2016 and 31 December 2017.

   ACCOUNT NAMES FOR INPUT:

   | Road roller | Plant | Machine | Motor van | Land | Building | Inventory | Intangible assets | Bank |

   | Payable | Receivable | Retained earnings | Other income | Other expense | Interest expense | Interest revenue |

   | Depreciation | Accum. depreciation | Impairment loss | Reversal of impairment loss | Loss on disposal | Gain on disposal |

   | Restoration liability | Goodwill | Revaluation surplus | Revaluation deficit | No entry |

   ANSWERS:

   Journal Entries:

   Date	Account Name	Debit ($)	Credit ($)	Hints For Sequence
   31-Dec-14	Blank 1	Blank 2
   	Blank 3	Blank 4		Judge Dr/Cr side.
   	Blank 5	Blank 6		Judge Dr/Cr side.
   	Blank 7	Blank 8		Judge Dr/Cr side.
   	Blank 9	Blank 10		Judge Dr/Cr side.
   	Blank 11	Blank 12		Judge Dr/Cr side.
   31-Dec-15	Blank 13	Blank 14
   	Blank 15	Blank 16		Judge Dr/Cr side.
   	Blank 17	Blank 18		Judge Dr/Cr side.
   	Blank 19	Blank 20		Judge Dr/Cr side.
   	Blank 21	Blank 22		Judge Dr/Cr side.
   	Blank 23	Blank 24		Judge Dr/Cr side.
   31-Dec-16	Blank 25	Blank 26
   	Blank 27	Blank 28		Judge Dr/Cr side.
   	Blank 29	Blank 30		Judge Dr/Cr side.
   	Blank 31	Blank 32		Judge Dr/Cr side.
   	Blank 33	Blank 34		Judge Dr/Cr side.
   	Blank 35	Blank 36		Judge Dr/Cr side.
   31-Dec-17	Blank 37	Blank 38
   	Blank 39	Blank 40		Judge Dr/Cr side.
   	Blank 41	Blank 42		Judge Dr/Cr side.
   	Blank 43	Blank 44		Judge Dr/Cr side.
   	Blank 45	Blank 46		Judge Dr/Cr side.
   	Blank 47	Blank 48		Judge Dr/Cr side.
   	Blank 49	Blank 50		P/L Item, Judge Dr/Cr side.
   	Blank 51	Blank 52		Judge Dr/Cr side.