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Question 16 Decka Ltd. has a financial year end of June 30. The following are transactions related to a new machine purchased on July 1,
Question 16 Decka Ltd. has a financial year end of June 30. The following are transactions related to a new machine purchased on July 1, 2013 and the subsequent costs and events. Date 1 July 2015 Decka Ltd. purchased a new machine for $180,000 (Plus GST) on Event Credit. The machine was installed and tested at a cost of $5,000 Plus GST, which was paid immediately. The machine was expected to last 5 years with a residual value of $25,000. The business uses straight line depreciation method. The business paid $4,000 (Plus GST) for repairs and maintenance to 31 December the machine. 2016 1 July 2017 Paid $16,500 cash (including GST) for the installation of a special device to the machine. The special device improved the machine's productivity. The special device is expected to extend the machine's useful life by 2 years, but no changes to the residual value. 1 July 2018 The business sold the machine for cash $125,000 (Plus GST) REQUIRED: Using appropriate ledger account names, prepare general jounal entries to record the following transactions. (Narrations are not required) a) The purchase of the new machine on July 1, 2015 b) The repairs and maintenance on 31 December 2016. c) The purchase of the special device on July 1, 2017 d) The sale of machine on 1 July 2018
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