Question
Question 2 (4 marks) Large Mart owns a computer (accounted for in account number 167 Computers) to track the inventory in its warehouse in Armidale.
Question 2 (4 marks) Large Mart owns a computer (accounted for in account number 167 Computers) to track the inventory in its warehouse in Armidale. On 1 June 20x1, the computer breaks down, and Large Mart spends $500 to repair the computer. Required: A) State whether the repair of the computer creates an asset, a liability, income, an expense or equity in the financial accounts of Large Mart.(1 mark) B) Explain your decision based on the criteria that the conceptual framework uses to define the item that is created by the repair of the computer, and describe how each criterion is fulfilled by the outlined situation. (3 marks)
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