Your firm is dealing with the following three companies and you are in the process of preparing financials for them.The CFO of each company comes to you with questions on the GAAP/IFRS reconciliation

Dowa, Ltd.. is a foreign company that uses IFRS for its financial reporting. Dowa is a wholly-owned subsidiary of Ide Corp. which is a U.S. company that prepares its consolidated financial statements in accordance with U.S. GAAP. Dowa purchased a piece of equipment for 2,000,000 on January 1, 2017. The equipment is comprised of the following three significant components, shown with their associated cost and useful life.

Component

Cost

Useful Life

Housing

400,000

20 years

Control Unit

600,000

5 years

Motor

1,000,000

10 years

2,000,000

As a corporate policy, Ide Corp. utilizes the straight-line method of depreciation for machinery and equipment and plans to extend this policy to Dowa, Ltd.

Prepare the journal entry for the 2017 depreciation expense for Dowa, Ltd. based on IFRS accounting principles.

Prepare the journal entry for the 2017 depreciation expense for Ide Corp. based on U.S. GAAP.

Prepare the journal entry to convert the 2017 Dowa, Ltd. financial statements from IFRS to U.S. GAAP.