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Skebus Inc. is an internationally active producer of learning software, and applies IFRS in its financial reporting. This mini - case investigates Skebus Inc. s
Skebus Inc. is an internationally active producer of learning software, and applies IFRS in its financial reporting. This minicase investigates Skebus Inc.s accounting for PPE, provisions and intangible assets, applying IAS IAS IAS and IAS and revenue recognition according to IFRS On Jan X Skebus Inc. acquires a new machine for CU that is recognized under IAS Depreciation is calculated according to the straightline method, useful life: years, residual value of CU On Dec X Skebus Inc. decides to use the machine for only more years, and estimates its then residual value to be CU On Dec, X the machine s value in use is estimated at CU the fair value was CU with incremental costs caused by a sale of Required: Calculate the a Carrying value of the machine a on Dec X Dec X and Dec X and b prepare the necessary entries in Skebus Inc. s financial statements as of Dec X and X On Jan X Skebus Inc acquires land for CU Payment is effected in cash immediately. The piece of land is measured according to the revaluation model after recognition. Fair value of the land changes as follows: X: X: X: Required: a Prepare the necessary entries in Skebus s financial statements as of Dec for the years X X X and decide if the change in value affects does not affect net income. b What is the carrying amount of the revaluation surplus on Dec X Skebus Inc s statement of financial position as of Jan X includes a provision for a law suit by a former employee, the carrying amount of that provision is CU In march X a judgment is rendered. The firm has to pay the former employee a severance payment of CU It has to make the payment immediately. Required: Prepare the resulting journal entry!
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