Question
Please answer this problem - USING THE ATTACHED ANSWER DOCUMENT: Deduhin Ltd acquired two new machines for cash on 1 January 2014. The cost of
Please answer this problem - USING THE ATTACHED ANSWER DOCUMENT: Deduhin Ltd acquired two new machines for cash on 1 January 2014. The cost of machine A was $400 000, and of machine B, $600 000. Each machine was expected to have a useful life of 10 years, and residual values were estimated at $20 000 for machine A and $50 000 for machine B. Because of technological advances, Deduhin Ltd decided to replace machine A. It traded machine A on 31 March 2018 for a new machine, C, which cost $420 000. A $200 000 trade-in was allowed for machine A, and the balance of machine C's cost was paid in cash. Machine C was expected to have a useful life of 8 years and a residual value of $20 000. On 2 July 2018, extensive repairs were carried out on machine B for $66 000 cash. Deduhin Ltd expected these repairs to extend machine B's useful life by 4 years and it revised machine B's estimated residual balue to $19 500. Machine B was eventually sold on 1 April 2010 for $300 000 cash. Deduhin uses the STRAIGHT-LINE depreciation method, recording depreciation to the nearest whole month. The end of the reporting period is 30 June. REQUIRED: Prepare general journal entries to record the above transactions and depreciation journal entries required at the end of each reporting period up to 30 June 2020.
ASSESSMENT ACTIVITY 2: CHAPTER 15 PROBLEM 15.1 - PAGE 665 [MODIFIED - PART A ONLY] 2014 To record purchase of machines A & B Depreciation of machines A & B 2015 Annual depreciation expense 2016 Annual depreciation expense 2017 Annual depreciation expense 2018 Deprecation of machine A to date of sale Trade-in machine A for Machine C Write off of machine traded in Deprecation of machines B & C Write back of accumulated deprecation on machine B due to overhaul Overhaul of machine B 2019 Depreciation of machines B & C 2020 Depreciation of machine B before sale Sale of machine B Write off machine B Depreciation of machine CStep by Step Solution
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