Takoya Bhd is a public listed company and established in 2000. The company was incorporated in Malaysia, involved in dairy farming, manufacturing and distributing of dairy products.

The following balances are for the year ended 30 June 2019.

	Note	Dr	Cr
		RM000	RM000
Sales			25,000
Cost of sales		11,800
Administration expenses		6,020
Selling and distribution expenses		1,200
Finance costs		265
Land (at revaluation)	2	11,000
Buildings (at revaluation)	2	32,000
Equipment	1	5,200
Machine A	1	4,050
Machine B		18,100
Motor vehicles		2,640
Fixtures and fittings		628
Goodwill	1	750
Accumulated depreciation as at 1 July 2018:
Buildings	2		3,840
Equipment	1		988
Machine A	1		770
Machine B			1,905
Motor vehicles			792
Fixtures and fittings			251
Biological assets	3	940
Investment properties		4,000
Investments		2,100
Intangible assets	5	794
Tax paid		277
Accounts receivable		2,320
Inventories		510
Bank balances		447
Ordinary shares			45,000
5% cumulative preference shares			10,000
Retained profits			9,280
Revaluation reserve (land)	2		450
8% debentures			5,000
Deferred income	4		300
Accounts payable			1,760
Accruals			230
Interim dividend	6	525
		105,566	105,566

QUESTION

You are required to prepare the journal entry of the transactions incurred and notes to disclose the movement in the companys property, plant and equipment (if applicable).

Notes 1

On 1 July 2016, Takoya Bhd acquired Pro Manufactures Sdn Bhd. During the acquisition, the equipment and machine A were revalued at RM5,200,000 and RM4,050,000 respectively. The agreed purchase consideration for the assets was RM10,000,000. The goodwill is derived from the acquisition.

Some technical problems had caused both assets to be less productive during the financial year ended 30 June 2018. As at 30 June 2018, it was estimated that the expected value in use amounted to RM7,000,000. Takoya Bhd determined that if the equipment and machine A were to be sold, the market value would be RM7,200,000. The cost to sell them was estimated at 5.5% of the fair value.

For the financial year ended 30 June 2019, Takoya Bhd had conducted a major inspection on the equipment and machine A. The company also did some intensive technical adjustment to improve the capacity of the plants. Due to this reason, it was expected that the value in use would be increased by 5% as compared to the year ended 30 June 2018 projection and the net selling price was estimated to be RM7,200,000.

It is the companys policy to depreciate equipment and machines at 10% on carrying amount. Machine A has a salvage value of RM50,000. The depreciations of equipment and machines are part of cost of sales. Goodwill has indefinite useful life.