Question1: ABC Ltd purchased a machine at a cost of $300,000 on 1 July 2020. It had a useful life of 10 years and after that residual value was estimated to be $60,000. The benefits from machine are expected to be spread evenly over its life. On 30 June 2022, fair value of machine was $230,000 and the salvage value and useful remaining life were the same as estimated at the time of its purchase. On 30 June 2022, the machine was sold for $130,000.

What journal entries will be recorded right from beginning until the sale of machine as per AASB 116 in the following cases:

a) If the revaluation was recorded. 4 Marks

b) If the revaluation was not recorded. 4 Marks

c) What will be the value of Impairment on 30 June 2022 if it was decided not to sell the machine.