On 1 July 2012, Weston Ltd paid $140,000 to acquire a machine that was to be used to manufacture steel cables. On this date, management of Weston Ltd estimated that the machine had a useful life of ten years and a residual value of $20,000. In accordance with AASB 116 Property, Plant and Equipment, Weston Ltd uses the revaluation model as its accounting policy to measure items of property, plant and equipment and the straight-line method of depreciation. The fair values of the machine for the first three years were as follows: 30 June 2013: $137,000 30 June 2014: $124,000 30 June 2015: $104,000 In October 2015, two competitors started selling high quality steel cables at prices that were well below those charged by Weston Ltd. By January 2016, Weston Ltds sales of steel cables had significantly decreased and the output of the machine had dropped to nearly a quarter of its expected capacity. In February 2016, Weston Ltd engaged the services of a consultancy firm who were tasked with reviewing Weston Ltds operations and advising how Weston Ltd could reduce its manufacturing costs. The review is expected to be completed in late May 2016 and the consultants expect to deliver their final report in late July or early August 2016. As at 30 June 2016, the fair value of the machine was $84,000 and the costs of disposal of the machine were estimated to be $200. As at this date, the value in use of the machine was determined to be $80,000.

Required

(a) Based on the requirements of AASB 116 Property, Plant and Equipment, provide (where necessary) appropriate journal entries in relation to the measurement of the machine as at:

30 June 2013,

30 June 2014, and

30 June 2015.

(b) Based on the requirements of AASB 116 Property, Plant and Equipment and AASB 136 Impairment of Assets, explain how Weston Ltd would account for the machine as at 30 June 2016 and provide (where necessary) appropriate journal entries.

(c) What other actions should Weston Ltd undertake on 30 June 2016?