Modern Ltd is a distributor of electrical appliances. At 1 July 2020, Modern Led acquired the following non-

Quiz

current assets for their business purposes:

Equipment

$400 000

Vehicles

320 000

They are in different classes of non-current assets and are to be measured at fair value. The expected useful lives of vehicles and equipment are 5 years and 10 years, respectively.

At 30 June 2021, the fair values of both assets were assessed. The equipment had a fair value of $328 000, and the vehicles, $280 000. The remaining useful lives were assessed to be 8 years for equipment and 7 years for vehicles.

At 30 June 2022, the fair value of equipment was assessed to be $327 000 and the fair value of vehicles was $220 000.

Required

Prepare the journal entries for Modem Ltd for the years ending 30 June 2021 and 30 June 2022.