QUESTION 5 An automated production line was acquired by Automs Ltd on 01 July 2021 from an overseas supplier. The piece of machinery was used to assist in dispatching poods ordered from an online retail store that has experienced significant sales growth following pandemic-related lockdowns. The purchase costs were $600,000, import duties and taxes $35.000, transportation expenses were $15,000, and the installation costs were $50,000. The transportation and installation costs were paid on receipt of the machinery and an agreement with the supplier was reached to pay the remaining balance within 120 days of receiving the machine. The company incurred costs of $5,000 for routine maintenance and servicing of the production line within 90 days of operation. The fair value of the machinery (including installation) was 5710,000. *Please indicate which question you are answering for each one Required: 1. Calculate the initial purchase price of the property, plant and equipment (automated bottling plant) and show your workings (include references to the accounting, standards marks). 2. Prepare general journal entries to record the initial purchase of property, plant and equipment using: O Cost model (3 marks) o Revaluation model (assume revaluation performed immediately after machine is installed) (4 marks) he toolbar, press ALT+F10 (PC) or ALT+FN+F10 (Mac). U Paragraph Arial V V 10pt V A v TE EE x In H x The 6 + RBC V v 39 . B. x Submit to save and submit. Click Save All Answers to save all answers. Save All Answers Close Window (hp QUESTION 5 An automated production line was acquired by Automs Ltd on 01 July 2021 from an overseas supplier. The piece of machinery was used to assist in dispatching poods ordered from an online retail store that has experienced significant sales growth following pandemic-related lockdowns. The purchase costs were $600,000, import duties and taxes $35.000, transportation expenses were $15,000, and the installation costs were $50,000. The transportation and installation costs were paid on receipt of the machinery and an agreement with the supplier was reached to pay the remaining balance within 120 days of receiving the machine. The company incurred costs of $5,000 for routine maintenance and servicing of the production line within 90 days of operation. The fair value of the machinery (including installation) was 5710,000. *Please indicate which question you are answering for each one Required: 1. Calculate the initial purchase price of the property, plant and equipment (automated bottling plant) and show your workings (include references to the accounting, standards marks). 2. Prepare general journal entries to record the initial purchase of property, plant and equipment using: O Cost model (3 marks) o Revaluation model (assume revaluation performed immediately after machine is installed) (4 marks) he toolbar, press ALT+F10 (PC) or ALT+FN+F10 (Mac). U Paragraph Arial V V 10pt V A v TE EE x In H x The 6 + RBC V v 39 . B. x Submit to save and submit. Click Save All Answers to save all answers. Save All Answers Close Window (hp
