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Subject: financial reporting IFRS 5 Photo processing machine On 1 January 20X1, Michelle Co. bought a photo processing machine for 20,000. It had an expected
Subject: financial reporting IFRS 5 Photo processing machine On 1 January 20X1, Michelle Co. bought a photo processing machine for 20,000. It had an expected useful life of 10 years and no residual value. On 31 December 20X2, after 2 years of using the machine, Michelle Co. decides to sell it and steps were taken to locate a buyer. The machines in question are in short supply, so Michelle Co. is confident that the machine will be sold quickly. Its current market value is 15,000 and it will cost 500 to dismantle the machine and make it available to a purchaser. Required: At what value would the machine be stated in Michelle Co.s Statement of Financial Position at 31 December 20X2? Outline the appropriate accounting treatment.
IFRS 5 Photo processing machine
On 1 January 20X1, Michelle Co. bought a photo processing machine for 20,000. It had an expected useful life of 10 years and no residual value.
On 31 December 20X2, after 2 years of using the machine, Michelle Co. decides to sell it and steps were taken to locate a buyer. The machines in question are in short supply, so Michelle Co. is confident that the machine will be sold quickly.
Its current market value is 15,000 and it will cost 500 to dismantle the machine and make it available to a purchaser.
Required:
At what value would the machine be stated in Michelle Co.s Statement of Financial Position
at 31 December 20X2?
Outline the appropriate accounting treatment.
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Advanced Accounting
Authors: Joe Hoyle, Thomas Schaefer, Timothy Doupnik
10th edition
0-07-794127-6, 978-0-07-79412, 978-0077431808
