ne ulated depreciation $1,360,000 504,000 $856,000 lation is calculated at $84,000 per year on a straight-line
ne ulated depreciation $1,360,000 504,000 $856,000 lation is calculated at $84,000 per year on a straight-line
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Vinubhai
Transcribed Image Text:On December 31, 2022, Shamrock Inc. owns a machine with a carrying amount of $856,000. The original cost and accumulated
depreciation for the machine on this date are as follows:
Machine
Accumulated depreciation
Depreciation is calculated at $84,000 per year on a straight-line basis.
A set of independent situations follows. For each situation, prepare the journal entry for Shamrock to record the transaction. Ensure
that depreciation entries are recorded to update the machine's carrying amount before its disposal. Assume that Shamrock uses IFRS
for financial statement purposes.
(a)
$1,360,000
504,000
$856,000
A fire completely destroyed the machine on August 31, 2023. An insurance settlement of $426,000 was received for this casualty.
Assume the settlement was received immediately. (Credit account titles are automatically indented when the amount is entered. Do not
indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before
credit entries.)
Date Account Titles and Explanation
August
31, 2023
August
31, 2023
(To record depreciation on machinery)
(To record disposal of machinery)
Debit
Credit
11
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