Question
On January 1, 2020, Suarez Company purchased with cash equipment costing $9,000,000 with a salvage value of $1,000,000 and an useful life of 8 years.
On January 1, 2020, Suarez Company purchased with cash equipment costing $9,000,000 with a salvage value of $1,000,000 and an useful life of 8 years. At December 31, 2022, after adjusting for straight-line depreciation, the information pertaining to the equipment is as follows:
| Expected future net cash flows | 5,000,000 | |
| Fair value | 4,800,000 |
Suarez intends to use this equipment in the future. However, it estimates that it will only use it for 2 more years. The salvage value is estimated to be $200,000 at the end of the useful life.
Prepare all journal entries related to this equipment for Suarez Company on the dates listed.
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| 01/01/2020 |
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| 12/31/2020 |
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| 12/31/2021 |
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| 12/31/2022 |
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| 12/31/2022 |
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| 12/31/2023 |
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| 12/31/2024 |
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Valuation For Accountants A Short Course Based On IFRS
Authors: Stephen Lynn
1st Edition
9811503567, 9789811503566
