Question
Synthetic Fuels Corporation prepares its financial statements according to IFRS. On June 30, 2016, the company purchased equipment for $406,000. The equipment is expected to
Synthetic Fuels Corporation prepares its financial statements according to IFRS. On June 30, 2016, the company purchased equipment for $406,000. The equipment is expected to have a seven-year useful life with no residual value. Synthetic uses the straight-line depreciation method for all depreciable assets. On December 31, 2016, the end of the companys fiscal year, Synthetic chooses to revalue the equipment to its fair value of $346,840. |
Required: | |
1. | Calculate depreciation for 2016. |
2. | Prepare the journal entry at the end of 2016 to record the revaluation of the equipment. (Do not round your intermediate calculations. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) |
3. | Calculate depreciation for 2017. |
4. | Prepare the journal entry at the end of 2016 to record the revaluation of the equipment. Assuming that the fair value of the equipment at the end of 2016 is $392,080. (Do not round your intermediate calculations. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) |
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