Question
On 30 June 2019, Swan Ltd acquired a machine for $180 000 cash, with an expected useful life of 9 years and a zero residual
On 30 June 2019, Swan Ltd acquired a machine for $180 000 cash, with an expected useful life of 9 years and a zero residual value. The company has adopted fair value for the valuation of non-current assets.
On 30 June 2020, the company hired an independent valuer who assessed the value of the machine to be $175 000 with a remaining useful life of 8 years and residual value of $5 000.
On 30 June 2021, the fair value of the machine is $122 000 with a remaining useful life of 6 years and zero residual value.
The company uses straight-line depreciation method for depreciating all its property, plant and equipment. Income tax rate is 30%. The financial year ends on 30 June.
Required
Prepare all the necessary journal entries related to the machine from 30 June 2019 to 30 June 2021.
| JOURNAL ENTRIES | |||
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Loose Leaf For Financial Accounting Fundamentals
Authors: John Wild, Ken Shaw, Barbara Chiappetta
6th Edition
1260151980, 978-1260151985
